Denver Towing Companies Routinely Overcharging On 'Drop Fees'

DENVER (CBS4) - Towing companies working in Denver have been routinely overcharging drivers for years, according to a CBS4 investigation, a practice several companies say they will stop as a result of what CBS4 revealed.

"Darn it," said the owner of one towing company when CBS4 provided evidence that their company -- and many others -- have been charging 366 percent too much for what are known as "drop fees."

A drop fee is what a tow company can charge when a vehicle owner, who has parked illegally, returns to their car before the tow company has hauled their car away. By law, the tow truck driver then has to allow the vehicle owner to pay a drop fee, much less than what it would cost to get the car back if it was actually towed away.

The Public Utilities Commission has set the maximum drop fee at $70. But the PUC has also said that if municipalities set a lower fee, towing companies must comply with city codes and only charge the lower fee.

In Denver, the maximum a drop fee can be is $15. According to 1987 city codes reviewed by CBS4, "the $15. would apply," said PUC spokesperson Terry Bote. "Our rules explicitly allow municipalities to set lower rates if they so choose."

Scott Martinez, Denver City Attorney, also said, "They should absolutely be capped at $15. I'm genuinely interested if folks are charging more."

CBS4 found they are charging more and have been doing so for a long time. Many tow companies said they were unaware Denver had a much lower drop fee than the state limit.

On March 26, a CBS4 undercover producer intentionally parked his car in a private lot at 1007 East Colfax in Denver without paying and then walked away. Within minutes, a tow truck from Wyatt's Towing swooped in to hook the car and tow it away. But the CBS4 employee returned before it had been towed.

"Hey dude, that's my car," said the CBS4 employee, who was carrying a camera.

"$70 drop," said the Wyatt's driver. "$70 or I'll take it'.

The CBS4 producer paid the $70 drop fee and retrieved his car.

Again on April 14, the CBS4 producer parked in the same lot, and again walked away without paying to see what the drop fee would be. The result was the same: a different tow truck driver said, "I can release your vehicle for $70. Or it would be $300 at the yard."

CBS4 paid the $70 fee and the car was immediately released.

The owner of Wyatt's, Troy Porras, declined to talk on camera or be interviewed, but released a statement saying, "Representatives of the City of Denver have communicated several times during the last 5 years that the rules in the Denver city code are no longer enforced and have been superseded by the PUC Regulations. We always strive to stay abreast of the current regulations and be in strict compliance. If the city has changed its position and now indicates that these rules are in fact valid and will be enforced, we will of course comply."

But Amber Miller, spokesperson for the Denver City Attorney's Office, said the city "never advised" anyone they could disregard the city ordinance and charge nearly 400 percent more.

However, other tow companies said they were unaware they were supposed to be charging much less in Denver than in surrounding communities. An employee at 24/7 Towing told CBS4 he had "never heard" of the $15 drop fee limit in Denver.

Another tow company owner said they too were under the impression their company could charge a $70 drop fee in Denver, and had been doing so for years.

But when CBS4 showed the company owner the applicable law, she said, "If that's what it says, that's what we need to be charging. We'll comply with the $15.

Multiple tow companies said everyone had been charging $70 in Denver for years.

After learning what the CBS4 investigation had revealed, several companies said they likely wouldn't even bother at all with a $15 drop fee, saying it wouldn't be worth their time, gas or effort.

CBS4 Investigator Brian Maass has been with the station more than 30 years uncovering waste, fraud and corruption. Follow him on Twitter @Briancbs4.