ADMINISTRATIVE REPORT

Date: October 4, 2002
Author/Local: G. Yuill/6276

RTS No. 03024

CC File No. 2801

Council: October 22, 2002

TO:	Vancouver City Council
FROM:	Chief License Inspector in consultation with the General Manager of Corporate Services
SUBJECT:	Amendment to Vehicle for Hire By-law No. 6066 Private Impoundment Towing Rate and Drop Charge

RECOMMENDATION

A. THAT Council approve that the private impoundment towing rate be increased to $62.50 and the drop charge rate increased to $31.00, subject to the towing companies agreeing, in writing, to storage charges of $16.00 for the first 24 hours and $12.00 for each additional 24-hour period.

B. THAT, subject to Council approval of the above, the Director of Legal Services prepare the necessary by-law amendments.

GENERAL MANAGERS' COMMENTS

The General Manager of Community Services and General Manager of Corporate Services RECOMMEND approval of A and B.

COUNCIL POLICY

The Vehicle for Hire By-law prescribes the regulation and the administration of the various classes of vehicles for hire.

PURPOSE

This report reviews the private towing impoundment rate and drop charge rate and recommends an increase that is in line with the City of Vancouver's Consumer Price Index (CPI) rate of inflation.

BACKGROUND

The City regulates private impoundment and drop charges under "Vehicle for Hire" By-law No. 6066. The by-law prescribes certain maximum fees that may be charged to the owner or driver of a vehicle that has been towed from a commercial lot pursuant to a tow-away notice or when the vehicle is claimed prior to being actually towed away (drop/release). Since the City has no power under the Vancouver Charter to regulate storage fees, impoundment and drop charges are approved subject to the towing companies agreeing, in writing, to specified storage charges.

The last impoundment rate and drop charge increase approved by Council was in December 1998.

DISCUSSION

Buster's Towing submitted a request that City staff consider an increase in the rates for private impoundment, drop (or release) charge and storage fees. City staff requested comment from the other towing companies affected by the by-law. At present, Buster's Towing, Drake Towing, Unitow and Priority Towing are the only towing companies licensed to provide these services in the City. The companies that provided comment all agreed to rate increases.

The companies cited rising operating costs such as fuel, fleet maintenance costs, equipment upgrades and increasing personnel costs as the main reasons for the requested increase. The last two impoundment rate and drop charge increases approved by Council were in June 1993 and December 1998. Approval of the rate increases was conditional upon the towing companies agreeing, in writing, to the recommended storage charges.

The Vancouver Consumer Price Index (CPI) was used as a general measure for changes in the rate structure. The average rate increase in 1998 was 8.5% while the City experienced inflation of approximately 6.4%. Between 1998 and mid 2002, the City's inflation rate, as measured by Vancouver's CPI, was approximately 9.9%. The recommended rate increase of 10.5% is in line with inflation.

Recommended Current
(2002) 1998 1993 1991

Impoundment $62.50 $56.00 $52.00 $50.00
Drop Charge 31.00 28.00 26.00 25.00
First 24hr Storage 16.00 15.00 13.40 12.00
Additional 24hr fee 12.00 11.00 10.00 9.00
TOTAL 121.50 110.00 101.40 96.00
Avg Increase 10.5% 8.5% 5.6%

IMPOUNDMENT RATE COMPARISONS

Neighbouring municipalities, including Richmond and Surrey have by-laws which regulate private towing impoundment rates, tying them to the ICBC prescribed rates. The following table provides a breakdown of the current and recommended rates for the City and summarizes the current ICBC rates used by these neighbouring communities.

Impound Drop First 24hr Addnl 24 hrs

Rate Charge Storage Storage

Vancouver (recommended) $62.50 $31.00 $16.00 $12.00
Vancouver (current) 56.00 28.00 15.00 11.00
ICBC 2002 rates:
Cat I - up to 3,628 kg- not MVA 42.60* 42.60 (ICBC does not prescribe
Cat II - 3,629 to 7,257 kg 69.90 69.90 storage rates)
Cat III - 7,258 kg and over 116.55 116.55

*Note: ICBC rates also provide for an additional charge for mileage of the tow, where the City's rates do not

As illustrated, the rate structure in Vancouver is flat, irrespective of vehicle weight. However, the ICBC private towing impoundment rates depend upon the gross vehicle weight. While the proposed impoundment rate for Vancouver is higher than other municipal rates for vehicles up to 3,628 kg not involved in a motor vehicle accident, the recommended rates compare favourably against the higher rates charged for vehicles greater than 3,628 kg.

Storage charges are not prescribed by ICBC. The storage rates are higher in Vancouver than in the neighbouring communities ($16 and $12 compared to approximately $8.40), however, this may be justifiable due to greater property related costs within the City.

CONCLUSION

The last private towing impoundment, drop charge and storage fee increase was approved in December 1998. This report recommends a rate increase that is in line with inflation. The recommended increase is consistent with past increases and the resulting rates appear to be comparable with neighbouring municipal rates.

* * * * *

(c) 1998 City of Vancouver