Relates to establishing a towing and storage bill of rights; and repealing certain provisions of such law relating thereto

Summary of provisions

OF BILL:

Section 1 of this bill provides that this act shall be known as the "towing and storage bill of rights act" and includes the following provisions:

Definitions - defines pertinent terms for purposes of this article;

Consumer notice provisions - requires notice to be given to the owner of the vehicle within 24 hours of commencement of towing relative to date, time and location of the tow, location where the vehicle is located, name address and telephone number of tow truck company, license plate number and description of the vehicle;

Itemized statement and release of the vehicle - An itemized statement for towing costs setting forth the cost for the tow, storage and any additional services shall be required to be provided to the owner of the towed vehicle or the owner's insurance company. The vehicle must be released upon payment of applicable charges, unless such release is not permissible pursuant to any state or local law.

Prohibited Acts - Sets forth prohibited acts for towing companies such as refusing to release a vehicle upon payment of all lawful charges (except when the release is prohibited by state or local law), falsely representing an affiliation with organizations providing emergency road service or other entities, charging fees which are excessive or unreasonable or charging for services to pad or inflate the towing bill.

Section 2 amends Section 399-xx of the General Business Law to authorize additional forms of payment for towing services.

Section 3 repeals Section 399-x of the General Business Law as its provisions governing forms of payment for release of a vehicle are included within the provisions of this bill.

Section 4 of the bill is the severability clause.

Section 5 of the bill is the effective date.

Justification

It is estimated that abusive towing and storage practices cost vehicle owners and their insurers over a half a billion dollars each year nationwide. While New York consumers have been dealing with abusive towing practices for a many years, problems associated with towing

abuses were highlighted in New York in the aftermath of Hurricane Sandy. It is estimated that more than 200,000 vehicles were destroyed by Hurricane Sandy and vehicle owners and their insurers encountered a number of difficulties related to towing during the process of handling claims for damages to these vehicles. Some bills for towing and storage of these Sandy damaged vehicles were in excess of $2,000, while the average crash related towing and storage fee in 2010 was $412.

Although most towing companies are honest and well-intentioned, some engage in abusive practices designed to increase towing and storage charges. One of the most common causes of towing abuse is failing to provide notice to registered vehicle owners and insurers that a vehicle has been towed and where it is being stored. Other forms of abuse include unreasonable limitations on access to towed vehicles by their owners or insurers, deliberately vague release procedures and elaborate documentation requirements - these are just a few examples of tools used to generate a larger bill and hold vehicles "hostage" until the bill is paid. By restricting access to the towed vehicle, storage charges are allowed to accumulate, in some cases, to an amount exceeding the value of the vehicle. In addition, there are "unbundled" fees (e.g., for administration, clean-up, helpers, mileage/fuel, labor, dolly, winching, extra hook-up, inspection, wait time and access, recovery, etc.) that can be tacked on to the bill, often without itemization, resulting in staggering bills.

New York drivers deserve some basic protections against these abusive practices. This bill would establish disclosure and billing requirements to guard against abusive towing practices. Specifically, this bill would require towing companies to provide vehicle owners with notice as to where the vehicle has been towed and how to get the vehicle released. Such notice would be required to be mailed to the vehicle owner by the towing company within 24 hours of commencement of towing. In addition, this bill would require an itemized statement of charges to be provided by the towing company so that charges for towing, storage and other services are clear and identifiable. This bill would also prohibit towing companies from charging fees which are excessive or unreasonable.

Legislative history

New Bill.

Fiscal implications for state and local governments

None.

Effective date

This act shall take effect on the ninetieth day after it shall have become law.