Police towing contractor charging fees not listed in city contract, owner says he's playing fair

DETROIT (WXYZ) - A suburban towing company with a city contract is accused of gouging the public.

Critics say the company is charging exorbitant fees that are not spelled out in its contract.

The company's owner admits he's charging for services not listed in his city contract but insists the charges are fair.

Ariel Pearson would certainly dispute that.

On Good Friday afternoon, our undercover camera caught Pearson walking out of Area Towing in Taylor in a fit of anger.  She threw her purse on the ground and the contents spilled out onto the pavement.  Pearson was shouting and flinging her arms into the air.

What was she so mad about?

She got a $440 bill from Area Towing after Taylor Police impounded her car for driving on a suspended license, and the bill was much higher than what she was expecting.

"When people get their cars towed their furious, they're not happy.  They didn't call me to tow their vehicle, right? The police did," said Shane Anders, owner of Area Towing.

Ander's company has an exclusive contract to do towing for the Taylor Police Department. The contract was approved by the Taylor City Council, and the towing rates are spelled out in Appendix A of the contract. It authorized a $120 fee for a standard tow, a $25 impound fee, a $21 fee for outside storage, a $32 fee for inside storage, and $89 an hour for work done above the standard rate.

But our 7 Action News investigation reveals that Area Towing has been tacking on a lot of charges that are not listed in their contract.

And that's why Ariel Pearson was so angry when we caught her on our undercover camera.

"I was heated. They told me $274 if I came and got it and then it was $440 when I got there," Pearson said.

Pearson was charged $36 for a no-show fee, and $136 for an after-hours fee, charges that are not listed in Area Towing's contract with the city.

When Action News started looking into Area Towing billing practices, we discovered that the company routinely charges for other services not specified in their city contract; lot fees, gate fees, winching fees, debris clean-up fees, miscellaneous fees, restoration fees and fuel charges. Area Towing has been charging these fees for years.

"I think it's like extortion, if you ask me," said Mike Pattenaude of Romulus.

Pattenaude knows a lot about the towing business. He's been driving a tow truck for a living for the last 15 years. When his wife had a seizure and ran off the road, Taylor police sent Area Towing out and they charged him $731.

Pattenaude questioned many of the charges on the bill, including an $89 dollar assessment for debris cleanup.

"There was nothing scattered all over the road. There was no debris, no nothing. The car was holding, no oil leaks, nothing," said Pattenaude.

The company's contract with the city says the contractor is expected to clean up debris at accident scenes but says nothing about charging customers a fee for the cleanup.

The accident left a rut in the grass between the street and the sidewalk. Area Towing charged Pattenaude $27.50 to throw down some top soil and grass seed. 

Pattenaude said he had never heard of a towing company doing landscape work.

Area Towing also charged Pattenaude $275 to tow his wife's car five miles to a dealership for repairs, and they tacked on $134 fuel surcharge. Pattenaude said the fee for the second tow was way out of line in his opinion.  Area Towing's owner, Anders, said charge for the second tow was within industry standards. The company's contract with the city does not list fuel surcharges in its fee schedule.

Pattenaude complained to the police department, and to the city council, but never heard a word from anyone.

Karema Williams questioned her bill from Area Towing after she was involved in what she described as a minor side-swipe accident. She was charged $479 for towing and storage.  She was especially upset that the company assessed a $35 lot fee just to go into the tow yard and look at her damaged car.

"At the same time, I brought someone with me who may have wanted to purchase the vehicle, but they would not allow him to see the vehicle and it would have been $35 for him and I each to see the vehicle," Williams said

Williams said because the tow bill was so high, and she didn't want to pay for a second tow to get the car repaired, she signed over her title to the towing company. They took $150 off her bill, took title to her car, and she still paid $329, including the $35 lot fee.

Lot fees are not listed in the company's contract with the City of Taylor.

The 7 Action News Investigators also discovered another issue with Area Towing.

Their city contract specifies that they "shall prominently and conspicuously post a sign...which sets forth the towing and service charges along with business hours" in their lobby. During the six weeks that we were looking into complaints about Area Towing's fees there was never a sign posted.

When 7 Action News Investigator Scott Lewis walked into the company's lobby with a camera

rolling and asked where their sign was, a clerk told him that customers kept ripping it off the wall and they were in the process of replacing it.

And what about all those fees the company is charging that are not spelled out in their contract with the city?  7 Action News asked Anders how he justifies the charges.

"I'm able to charge those because when I've gone to court and been challenged, the judge has ruled that they're fair and reasonable," Anders said.  He also stated that while the contract doesn't say he can charge these fees, it doesn't say that he cannot charge them either.

Mike Tadenude said he doesn't buy Ander's explanation.

"If you sign up a contract, the contract should be abided by, nothing different," Tadenude said.

The Taylor City Council approved extending Area Towing's contract by a 5-4 vote in 2010 after Chief of Police Dale Tamsen told council members that he was happy with the company's performance.

When 7 Action News went to Area Towing to question Anders about his fees, we were surprised to find the police chief was there to support Anders. Tamsen defended Area Towing's charges, though he admitted the company is expensive, and they do charge fees that are not specified in their contract with the City.

"I think we can make things clearer in the contract and we've been working with Area Towing to do that. I don't think a contract can actually cover every situation we may run into," Tamsen said.

But City Councilman John Delo, who voted against the company's contract extension in 2010, said he thinks their charges are excessive. Delo said there have been numerous complaints from the public about Area Towing's fees and everyone on the council is aware of it.

Delo is also troubled by a clause that takes authority for extending the towing contract away from council in the future. It allows the Chief of Police to grant two three-year extensions without a council vote.

"I think the first thing we would have to do is take the responsibility for renewing that contract out of the hands of the police department and put it back in the hands of the city council," Delo said.

Delo told 7 Action News he plans to push to have that contract language changed and to bring Area Towing's owner before council "to see if we can't persuade him to come back into line with what we think the contract says".

And speaking of following the contract, remember the towing rate sign that was missing in the company's lobby when 7 tablettablettAction News showed up unannounced with a camera rolling?

When we returned a few days later to interview the owner, a sign spelling out towing charges was prominently displayed in the lobby. The sign lists fees specified in the city contract as well as the fees not-spelled out that have prompted complaints from the public.

Area Towing's contract with Taylor Police expires next year.  Unless the City Council does something to intervene, the Police Chief will have authority to give them two three-year extensions without council approval.

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