Tow Franchise Idea Dropped In Exchange For Other Changes

OCEAN CITY — Members of the towing industry rallied against the proposed franchise for police tows last week, and it appears that this week, they might just get everything they were asking for, including a raise in their license fees.

As alluded to by City Manager Dennis Dare last week, the solutions or alternatives that were presented by members of the towing industry last week may be enough for the town to abandon the idea of establishing a franchise that would handle the town’s police tows.

“My only concern with all of this was to eliminate the $154,000 deficit that the city’s impound lot currently runs at,” said Dare. “So, I wanted to stop losing money, and it looks like the things they brought to the table will do that.”

Towing professionals pitched the ideas of increased license fees, a hike in daily storage fees at the city’s impound lot, and a shrinking of hours on the lot, which they claimed, would be enough to cover the current deficit.

As a result, when Dare presented the proposed FY 2010-2011 budget to the Mayor and City Council on Monday, he had tweaked the numbers in those categories to meet the demands of the industry and concurrently the needs of the town.

“What I found out is that we were charging too less for daily storage fees, and that they were willing to pay higher license fees instead of us going the franchise route,” said Dare. “Couple that with the fact with my plan to cut the hours at the impound lot to essentially one shift in the off-season, will meet the goal and close the issue in my mind.”

What Dare proposed in the budget includes a 200-plus percent increase in towing license fees from $150 to $500, as well as a huge spike in daily storage fees at the impound lot from $10 the first day, to $15 for each additional day, to $40 per day.

Dare said that the decision to make it $40, might seem steep until you look at the fact that impound lots throughout the county are charging an average of $45-$50 per day.

“Basically, the taxpayers were subsidizing a convenience for those who essentially break the law,” said Dare. “If the council wants to make further changes, that’s up to them, but I’m not sure if raising the fees close to market value would even make a franchise that lucrative for a single operator.”

Almost $100,000 of the $154,000 deficit will come from the decision to close the impound lot for two of the three shifts during the off-season by cutting payroll and operational costs.

Currently, the impound lot stays open 24 hours a day, 7 days a week, all year long, according to Dare, and the new off-season hours will be pitched be something in the ballpark of 6 a.m. to 4 p.m.

Still, Mayor Rick Meehan doesn’t rule out the idea of the franchise idea coming back to the table, despite the council’s vote to table a resolution that would have allowed them the power to establish the aforementioned franchise.

“The hours of operation were just too much, even though we want to provide convenience for our guests in Ocean City,” said Meehan, “but I think Mark Anderson [owner of the Exxon station on 52nd Street] had it right when he said that this discussion was too close to the summer season, and we should wait until the fall to bring it up again.”

Still, Meehan is a little concerned with the price hike for daily storage fees and said the hike from $10 to$40 might be too steep and needs further discussion.

“It is easy to just pass the buck onto the tourists, but we need to really look at who that change is going to effect and how much,” said Meehan.

The reasoning behind the towing industry’s apparent disdain for the franchise idea perhaps stems from the competitive and often unfriendly nature within the business itself.  The fear seemed to stem from the idea that establishing a franchise would give one company too much power, and personal feelings toward competing companies could adversely affect other businesses. 

“We just want things to stay the way they are, and we aren’t opposed to paying more money for the license fees,” said John Derrickson of Berlin-based John’s Auto Body last week at the council’s work session at City Hall, “but consider raising the fees for your impound lot, because they are just too low.”

Councilman Doug Cymek motioned to table the resolution that would have given the council the power to establish a franchise, noting he had made several promises to the towing industry that he didn’t intend to break.

“I feel for them in this case, and I made them a promise that if we could find a solution to eradicate the $154,000 deficit at the impound lot we would go that route and it looks like we have,” the first-term councilman said.