TOWING UTOPIA EXCLUSIVE: Juicy Report On Booting Abuses In Minneapolis

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Somebody who can remain anonymous provided me the juicy 9-page staff report which documents outrageous abuses by "booters" in Minneapolis. This is the document which caused the City Council to UNANIMOUSLY ban booting by private entities...

The report pulls no punches, rather like some of the booted individuals themselves. The tendency of towers/booters to systematically prey on college students is outlined pretty well in discussion about incidents in "Dinkytown."

I hope this document might be enlightening to policy makers in other cities when it comes to common patterns of booting abuse. Without further ado, here it is.

Public Safety & Regulatory Services Committee
Title 13, Chapter 320 Vehicle Immobilization
Staff Report
May 21, 2008

History:

The vehicle immobilization ordinance, more commonly known as booting, was first introduced to the Public Safety & Regulatory Services Committee on April 20, 1994. At this time one company was booting vehicles in Minneapolis. Without a booting license, the city was unable to regulate this industry. The city had to create a license category or ban the practice. Booting was authorized in other cities to address issues such as scofflaws, DUIs, and/or child support. Chapter 320, Vehicle Immobilization, was added to the Minneapolis Code of Ordinances.

From 1994 to 1997, five (5) booting companies applied for licenses. In September 1997 only one company, Gopher Towing, was still in business. Records are not available regarding the operation of these companies.

Since 2000, a number of new licenses have been issued to booting companies. In 2000, booting companies could not park in a lot and monitor activity. They could only respond to a call for service by the owner of the parking lot. Booting companies found it easier, and certainly more profitable, to park in a lot, monitor it themselves, and boot vehicles.

Thus the term “Predatory Practices” was used to identify the behavior of the booting industry both in Minneapolis and throughout the United States. Other complaints included non-existent or improper signs, booting without proper authorization, charging unauthorized fees, intimidating behavior, and threatening to tow a vehicle if the customer did not pay immediately. All of these complaints still occur today.

In 2005, complaints were so numerous that the 2nd Precinct Community Response Team (CRT) conducted surveillance at several parking lots. They found booters parked inside the lots, booting vehicles, and then seeking written authorized by the business owners after the fact. All of these behaviors were in violation of the code of ordinances.

When approached by the police, employees of the booting companies stated they had no knowledge or training regarding rules of operation. The following week a second employee of a particular company was found duplicating the same practices. He told police he knew the first employee had been warned about patrolling the lot and that it was a violation of ordinance. The police issued a Motor Vehicle Tampering citation. The profit margin far exceeds the fines associated with violations.

Later that year Council Member Paul Zerby made a recommendation to ban booting in Minneapolis. Instead of banning booting, staff was directed to create a Task Force to meet with the booting industry, revise the ordinance to eliminate the predatory practices, and develop stringent requirements aimed at eliminating illegal booting practices. Members of this Task Force included business owners and a consumer representative. It was assumed that the number of complaints would then decrease. In April, 2005, numerous changes were made to the code of ordinances. Additionally, training was provided to all booting companies regarding the new requirements.

Enforcement:

The intended results of the 2005 ordinance amendments have fallen short of their mark. 52 citations have been issued to the six booting companies, totaling $24,950 in fines. Over 300 complaints have been made. Every citation appealed has been reviewed by an Administrative Hearing Officer and upheld in favor of the city. Listed below is a summary of violations the six licensed companies have accrued since 2005.

Clampdown: (August, 2003 – September, 2007) This company received 16 administrative citations totaling $11,600 and after a Technical Advisory Committee (TAC) hearing was directed to reimburse $2000 in TAC fees and reimburse charges to all vehicles booted from October 1, 2005 to February 10, 2006. In March, 2006, additional violations occurred and their license was suspended for 30 days. In September 2006, License and Consumer Services’ recommendation to deny renewal of Clampdown’s license was approved by the city council.

Force Management: (July, 2000 to present) Nine (9) administrative citations totaling $5,800 in fines have been issued. They received a written warning and five administrative citations for not posting a sign stating that a parking lot “is currently under surveillance and offenders will be booted immediately” and not removing the sign when they left the lot. They have also been cited for booting vehicles without proper authorization, booting a handicap vehicle without proper authorization, overcharging, and given a warning that is was illegal to boot for a traffic violation. The activities of this company generate more complaints than any other booting company. In one case, Force Management appealed a citation and it was determined at the hearing that the boot was illegal. The client sent a request for reimbursement to the company.

Force management’s attorney responded that the matter was fully adjudicated by an administrative hearing officer and since no refund was ordered, none was due. Even though the vehicle was booted illegally, Force Management will not issue a refund. The Licenses Division cannot enforce reimbursement of fees. The booted party’s only option for reimbursement is to take Force Management to small claims court, diminishing the principles of the Administrative Hearing process established by the city.

Limited Space: (December, 2006 to present) Three administrative citations totaling $600 in fines have been paid by this company. The owner is former employee of Clampdown and the license was issued with five conditions. In addition to conditions related to complying will the ordinance, no employee may have any involvement with the past owner or any former employees of Clampdown.

The former owner of Clampdown contacted the Licenses Division to discuss an agreement he had with his former employee, the current owner of Limited Space. He stated they had a partnership agreement in which he was to get 50% of Limited Space’s booting revenue. The nature of the call was to complain that his former employee was violating this agreement. The caller submitted a Business Deposit Account Application dated February 21, 2007. Both their names and signatures were listed on this document clearly in violation of the license conditions.

Parking Solutions Inc: (September, 2003 – September, 2007) This company received eight administrative citations totaling $2,150 in fines and the city received numerous complaints. They paid their last fine of $750 in a NSF check. This money has never been collected and the company is no longer in business.

Star Phoenix: (May, 2005 – September, 2006) In their year and a half in business, this company received eleven administrative citations totaling $3,000 in fines to the city. Their violations included illegal signs while monitoring lots, sitting outside parking lots watching for vehicles, incorrect information of forms, failure to include the city’s phone on their form for customers to file complaints, and submitting false monthly booting logs. They did not submit an application to renew their license.

Wrecker Services: (June, 2000 – Present) Three administrative citations totaling $600 have been issued to this company. This was based on a single incident and the city has not had any further issues with Wrecker Services. Wrecker Services’ primary business is towing and rarely uses boots to address parking violations.

Case History:

Examples of illegal booting activities in Minneapolis are noteworthy, varied, and repetitive. In one situation the booter blocked a moving vehicle with another vehicle in order to install a boot. On anther occurrence the booter did not have a vehicle available to block the vehicle so a co-worker stood behind vehicle to prevent it from moving before the boot was secured. Other examples include the following:

A booting company was directed by the business owner repeatedly not to boot vehicles on Sundays or after 9:00 pm. when the business was closed. Since April 2007, 95 vehicles have been booted during these hours and the booting company has collected $9,500.

A former employee of a booting company reported to a License Inspector that he was reminded at least 2 dozen times to tell customers that the credit card machine was broken and they would have to pay by cash. He also reported that his company was instructed by the District Manager of the parking lot to give customers a ten minute grace period before booting their vehicles. No one should receive a boot if they parked in the lot less than ten minutes.

To this, the booting company instructed him to make sure the ten minute window was recorded on the paperwork, regardless of how long the vehicle was in the lot. The employee described that if a vehicle arrived at 8:00 p.m. and the driver returned at 8:05 p.m. with a boot on their vehicle, the paperwork indicated that the boot was not placed on the vehicle until 8:10 p.m.

A third example occurred in April, 2006 when Force Management booted an unmarked Airport police vehicle with a sign in the window stating “Airport Police on Official Business.” The officers asked if they could talk to the property manager who ordered the removal of the boot. The booting manager told the police officers that the property manager had no authority so the officers paid the fee to remove the boot. After investigating this situation, the booting manager reported to the License Inspector that he offered to remove the boot but since they had paid their fee there was nothing he could do to reimburse their money.

Complaints are received in many forms and it is not uncommon to have police involvement. In one incident, a customer went to the cash machine only to find it was broken. He then went to a cash machine across the street. When he came back to go to the video store, he saw a boot on his vehicle and called the police. The officer said it was reasonable for him to go to the other cash machine. At that point the individual was becoming hostile and the police officer ordered the boot to be removed. After it was removed the officer left the lot.

Twenty minutes later the officer was called backed to the same location due to customer trouble. The same individual’s vehicle was booted when the individual went into the video store, an authorized business. The employee of the booting company called his supervisor and was told that the police had no right to order removal of a boot and he directed his employee to reboot the vehicle immediately. The officer ordered the boot to be removed a second time and the police confiscated the boot and property inventoried it.

Another type of example frequently initiated by a complaint began with a verbal commitment from PSI to the License Inspector on September 12, 2006. PSI stated that they would send a refund the week of September 18, 2006. On November 21, 2006 PSI reported that they sent the check out on November 20, 2006. The check had still not been sent on January 24, 2007 so the License Inspector told PSI to send the check to the Licenses Division. PSI agreed. On January 29, 2007 PSI sent the License Inspector an email stating “I have sent you a check.” As of February 20, 2007 neither the Licenses Division nor the client had received the check. The check was finally received. This is not uncommon for the License Inspector to invest numerous hours and a client to wait six months or more before refunds are finally made for illegal booting practices.

Finally the following is a chronology of an actual case.

April 8, 2006: Parking Solutions Inc (PSI) boots a vehicle and requires payment of $99.75 for the boot to be removed. The individual told the PSI representative that he didn’t think they had a right to boot his car. PSI tells him to make a written request for return of his money. The individual requests a refund in writing.

May 6, 2006: PSI responds by refusing to return any money and suggests that the individual sue them in conciliation court.

May 22, 2006: The individual files a conciliation court action against PSI. PSI is served with notice that a hearing will be held on July 31, 2006.

July 31, 2006: The individual appears at the conciliation court hearing. PSI does not appear. The judge asks the individual to present his case. He does so and is awarded judgment in the amount of the immobilization fee plus costs. The individual emails PSI that same day asking to be paid. PSI responds stating that they will pay.

August 2006: No payment

September 6, 2006: PSI still has not paid the individual. The individual enters judgment in Hennepin County District Court. PSI is served with notice of entry of judgment.

September 18, 2006: Payment still not made. Individual obtains a writ of execution from Hennepin County Court and serves it on the CC Club, the business on whose behalf PSI provided the booting service. The individual also obtains an Order for Disclosure from the District Court which requires PSI to disclose the location of its assets.

October 11, 2006: Still not paid by PSI, the individual obtains an Order to Show Cause signed by Judge Patricia Belois. The Order to Show cause requires 1) PSI show up in
District Court on November 1, 2006 and 2) explain why they failed to provide the information directed by the Order for Disclosure or a bench warrant will be issued for the arrest of PSI’s CEO. That same day the individual talks to the owner on the telephone. The owner says he will pay the judgment. Payment in the amount of $250 which included costs and interest caused by the delay is made by PSI.

Booting Analysis:

There are several reasons documenting that booting practices, the impact of booting on the availability and turnover of parking, and our responsibility and ability to provide consumer protection are ill matched for the city of Minneapolis.

1. Time Delay: Based on booting industry information, 78% of people who park in retail lots are only there for 12 minutes or less. If a vehicle is immobilized, it will remain in the parking spot for a minimum of 15 additional minutes and more likely 45 minutes as people try to figure out 1) why their vehicle was booted 2) study the signs 3) talk with the booter and 4) arrange to get financing so the boot will be removed and 5) actual removal of the boot. All of this occurs in the original parking spot. Booting a vehicle contributes to the shortage of short-term parking in private lots by prolonging the time it takes for the vehicle to leave the lot and free up the spot for another customer.

2. Alternatives: There are alternatives to booting which address both the need for turnover and accountability. Vehicles could be towed. This option is most effective for violators who park for extended periods. If the majority of vehicles leave a parking lot within 12 minutes, authorized or not, turnover among parking spaces will occur prior to the arrival of a tow truck. The majority of vehicles are booted from Free Lots which do not charge a fee. These owners are not concerned with lost revenue as parking turnover is necessary for successful business operations.

3. Predatory practices: The types of complaints and violations outlined in this report are representative of the booting practices in Minneapolis for the last 14 years. Repeated citations, fines, and suspensions have not impacted the city’s ability to hold booting companies accountable to our ordinances. Additionally, as a regulatory agency, we have no authority to enforce judgments against companies, thereby diluting our ability to meet our consumer protection responsibility.

4. City Resources: The city issues approximately 9,000 licenses annually. Nine (9) of these are vehicle immobilization licenses. Several complaints are filed each week and numerous violations have been verified against nine (9) companies. The current commitment of License Inspectors assigned to enforcing regulations has not proved effective to achieve compliance in the industry. There is an inordinate amount of time chasing complaints for such a small number of licenses.

5. Demographics: In October and December of 2006, License Inspectors studied all the vehicles booted by two companies in a two month period. 520 vehicles were booted for a total of $52,000. 35% of the individuals whose vehicles were booted were Minneapolis residents. 50% were non-Minneapolis residents who live in Minnesota. 15% of the individuals were not from Minnesota. In a single lot in Dinkytown, 65% of the individuals booted lived outside of Minneapolis. Booting does not exist in any other Minnesota city with the exception of St. Paul which does virtually none.

Between June 1, 2006 and August 18, 2006 one booting company immobilized 51% of their total vehicles in a single lot in southeast Minneapolis. From August 19, 2006 through the end of September, 94% of the vehicles immobilized by this company resulted from this lot, This lot is located near the University of Minnesota and the influx of new college students, and their families, presents an opportunity in mid-August and early September.

6. Safety issues: Due to the confrontational nature of the business, violence occurs. Here are a couple of excerpts from Minneapolis police reports:

a. June 2005 - When person found that their vehicle had been booted, they became enraged and threatened the booter. They then smashed out the booter’s driver side window and left the area.

b. December 2005 - As soon as the boot was removed booted party spit in booters face and pushed him. As booter confronted booted party he was grabbed by the face. The booter maced the booted party.

c. January 2006 - Booter had just colleted the money from the pay box at the parking lot he was monitoring. As he opened his vehicle door he was pushed to the ground and taken in a strong arm hold. The robbery included $1000 and a civilian model taser.

d. February 2006 - Booter called police because he was threatened with a gun. Booter stated that he was afraid for his life because two males were yelling at him. Suspect was arrested with a Glock .40 caliber handgun and 10 rounds of ammunition.

e. February 2006 - Booted party started yelling at booter and said “I know your face and I’ll be back tomorrow and I’ll kill you.” Booted party attempted to get into the booter’s vehicle and kneed the front passenger door. Booter got out of his vehicle and said he would mace the booted party. Booter said the booted party came within inches of him saying “You’re not gonna mace me. I’ll kick your ass.” Booter stated that he was in fear for his safety and called police. Booted party left the area.

f. April 2006 - Booter and booted party started swearing at each other. Booter then maced booted party. A fight broke out and booted party had booter in headlock when police arrived.

g. March 2006 - Booter was taking a boot off a vehicle. As he released it, the booted party drove away driving over the booter’s foot and leg. Booted party fled the scene. Booter was treated by paramedics. Booted party was booked for felony hit and run and criminal vehicular operation.

h. August 2006 - When person came back and found their vehicle booted, they went over to the booter’s vehicle and poured a large cola over the booter’s head and his car seat.

i. August 2006 - Booted party tried to pull the boot off and was going to drive away with the boot on. The booter parked his vehicle behind the booted party to block it and went to tighten the boot. At that time the booted party punched the booter in the mouth. When booter went to get his taser, booted party left the area and called police.

j. August, 2007: License Inspector conducted surveillance of booting procedures. Called 911 for a squad when he watched a booted party grab the booter by the neck, lift him off the ground, and started chocking him.

Industry Position

Literature from a booting company in Chicago, IL (Chicago Parking Management, Inc, 2007) and Clampdown in Minneapolis have developed brochures used for marketing their services. These companies make the following claims to promote and justify their business practices.

a. Many lot owners and management firms are troubled with towing customer’s cars. However, without enforcing the parking fees, customers will take advantage of parking.

The fact that almost all the lots where booting has occurred in Minneapolis are free lots dissolves this platform.

b. Immobilization companies state that towing vehicles would be less effective. Since 78% of retail lot violators illegally park for twelve minutes or less, parkers have time to park illegally and exit before a tow truck arrives.

Neither towing nor booting are not effective for short-term parkers. Illegal parkers will get away but the turnover of parking spots is preserved without intervention.

3. The vehicle is not moved which automatically increases the city’s liability when a mistake is made by the tow company.

The Licenses Division has not received a complaint about a vehicle towed in error. Additionally, complaints filed about tow companies have been resolved in two or less telephone calls.

4. The violator pays the booting company right away and does not have to travel to get to the impound lot to claim their vehicle.

There is not immediate response when a vehicle is booted. A 45 minute time period before a vehicle is safe to drive does not represent a standard of convenience for customers.

Secondly, the practice in the industry stating that the credit card machines were broken and only cash would be accepted puts individuals at risk and is difficult to regulate. If a tow is justified, an inconvenience results for the individual. However, it is arguable that this provides a greater protection to consumers.

5. The income generated from booting parking violators is used to offset the cost of lot maintenance and repair.

In the past, there was nothing prohibiting booting companies from offering property owners a percentage of the booting fee. The 2005 ordinance amendments have prohibited this practice. There is no evidence that this practice has ceased, but there is no documented evidence that it is still occurring. If this premise is true, remuneration is occurring in Minneapolis.

6. Unauthorized cars tie up spaces in parking lots during the lag time waiting for a tow truck. Paying customers cannot get to businesses.

A booted vehicle remains unauthorized in a lot until the boot is removed. This has the same impact on paying customers.

Best Practices

On July 24, 2005 a bill was passed in the state of Washington with a vote from the house of 94 to 0 and 46 to 0 in the Senate.

One year later the state of Washington abolished the practice of booting. That bill stated the following:

“Immobilize” is defined as the use of a locking wheel boot that, when attached to the wheel of a vehicle, prevents the vehicle from moving without damage to the tire to which the locking wheel boot is attached. Property owners are prohibited from immobilizing any vehicle not owned by them; however, the state or any unit of local government is exempt from this prohibition. A violation of this act is a gross misdemeanor.” They also added a penalty provision to the bill – up to $5,000 fine and/or one year confinement for a violation.

Other private property booting regulations of 19 cities similar to Minneapolis include the following:

Five (5) other cities allow booting:

1. Atlanta, Georgia - $50 boot removal fee.
2. Chicago, Illinois - $115 boot removal fee. Private and municipal companies authorized to boot in specific wards.
3. Denver, Colorado – Boot removal fee is the same as a parking meter violation.
4. Madison, Wisconsin - Maximum $50 boot removal fee. The booted party may either pay the removal fee or sign a deferral agreement in which the person agrees to pay the removal fee to the parking enforcer or contest the booting.
5. Miami, Florida - Maximum $85 boot removal fee. The city receives a $25 administrative fee for each vehicle booted.
6. Minneapolis: Booting fee is 75% of the Impound/Towing fee. Current cap is $103.50.

Nine (9) cities had no information in their ordinance which indicates that it is not allowed:

1. Biloxi, Mississippi, 2. Dallas, Texas, 3. Houston, Texas, 4. Indianapolis, Indiana,
5. Kansas City, Missouri, 6. Knoxville, Tennessee, 7. Omaha, Nebraska, 8. St. Louis, Missouri, 9. San Francisco, California

Five (5) cities only allow city officials to boot for parking violations:

1. Cincinnati, Ohio, 2. Detroit, Michigan, 3. Pittsburg, Pennsylvania, 4. Reno, Nevada,
5. White Plains, New York.

Recommendation:

Based on the information outlined in this report, the Licensing Division recommends that Title 13 Chapter 320 be amended to prohibit vehicle immobilization on private property in the city of Minneapolis and failure to adhere to this is defined as a criminal violation.