David Allio/Icon Sportswire via AP Images
A semi truck tractor is seen being towed on May 15, 2020 in Veedersburg, IN.
A $9,200 fee because it was over 98 degrees. A $500 charge for taking cell phone photos. A fee just for opening the gate to the tow lot. When truckers get towed in an unfamiliar area, these are some of the exorbitant fees they might be subject to. The Owner-Operator Independent Drivers Association (OOIDA), a non-profit that advocates for small business truckers, has seen fees as high as $100,000 for a single tow.
The Biden administration has a name for these kinds of hidden, deceptive or unfair costs: junk fees. There’s been a whole-of-government approach to tackling them, and a flagship regulation in the works at the Federal Trade Commission (FTC) that would ban them. But while the campaign has focused on junk fees in travel, banking, and even rental housing, long-haul truckers are highlighting another painful example: the often financially devastating impact of predatory towing charges.
There are two kinds of tows, consensual and nonconsensual. If the trucker calls for a tow themselves, they can choose a company they trust. Nonconsensual tows are usually initiated by law enforcement, often after an accident. If a semi truck breaks down on a highway and blocks traffic, police will call the closest towing company to free up traffic, regardless of driver input. Since truckers can’t control where they break down, they might end up getting towed by a predatory company, often putting them tens of thousands of dollars in debt. And because many truckers are classified as independent contractors rather than employees of a company, that burden falls on them directly.
During nonconsensual tows, truckers have little to no control over the charges they face. Fees range from the understandable—labor costs, special equipment use—to the ridiculous. Think $200 snack charges for employees, fees for unnecessary equipment, or charges for simply communicating over the phone. In some states, towing companies aren’t required to list specific charges, allowing them to bulk up the bill without accountability.
“It’s sad how these guys and gals are treated. It’s sad that they get taken advantage of on a regular basis,” said Doug Morris, the director of state affairs at OOIDA. “Most tow companies are good, honest businesses. But some of them, one to two per state, take advantage… a lot of the time, they put a guy or gal out of business.”
In November, The American Transportation Research Institute (ATRI) found that 83 percent of truckers who have been towed experienced excessive rates, while 82 percent experienced unwarranted service charges. ATRI also found that a majority of those who had been towed encountered other issues such as delays in getting their truck released from the towing company, truck seizure without cause, or cargo release delays.
Predatory towing has long been an issue in the trucking industry, but has recently come to the forefront after Transportation Secretary Pete Buttigieg expressed support for truckers at a Federal Motor Carrier Safety Administration (FMCSA) meeting on June 21.
“This department has been clear in our support of protections against predatory towing junk fees,” Buttigieg said. “In the event that their truck gets towed, they may not have any relationship or familiarity with the towing company that moves their vehicle. Until they get that vehicle back, their job and really their livelihood is put on hold.”
“Of course, there are necessary and fair costs associated with the towing of a commercial vehicle. But some companies have seen an opportunity to charge exorbitant fees,” he added.
“Tow trucks are trucks. Not every tow truck operator is a predatory tower or a price gouger. It’s a few bad apples spoiling a larger bunch.”
Buttigieg’s comments are in line with the Biden administration’s pre-election push to get rid of junk fees, in the hopes that it will appeal to American consumers who have negative views of the economy due to the price of goods and services. The FMCSA meeting came after it issued a comment to the FTC in February, supporting the proposed rule and offering amendments that would protect truckers and other commercial drivers. The agency suggested banning fees for unnecessary goods and services, prohibiting excessive charges, and treating each hidden or illegal fee as a separate violation of the rule.
The FTC’s effort to ban junk fees and hidden charges on consumer purchases like flights, concert tickets, or hotel rooms resulted in a proposed regulation in October. The rule is going through a lengthy comment and revision process before becoming an official policy. If the FTC’s proposed rule were finalized as proposed, it would ban businesses from hiding fees and require them to show the full price upfront.
Not all truckers and industry advocates are optimistic about the proposed rule. Morris, at OOIDA, thinks that representatives of the trucking and towing industries are better equipped than the government to come up with a solution to predatory towing.
“You never know what you’re gonna get when the government gets involved, and it could get worse,” he said.
Pam Bracher, deputy general counsel at the American Trucking Associations, is focused on statewide laws as a potential solution to predatory towing. She suggested four main policies that states should enact: mandatory invoices itemizing all charges, maximum rates for towing and recovery services, a centralized grievance process to dispute charges, and cargo release provisions, which would allow truckers to have their cargo recovered from the tow lot while payments or disputes are ongoing. According to Bracher, 15 states already require invoice itemization, and eight have some form of cargo release provisions. Still, this leaves truckers in the majority of states vulnerable to hidden fees and holds on their cargo, which in turn can lead to more expenses from upstream and downstream stakeholders.
Bracher, like Morris, emphasized that her concern is not with the towing industry in general, but with the few companies that exploit truckers.
“Tow trucks are trucks. Not every tow truck operator is a predatory tower or a price gouger. It’s a few bad apples spoiling a larger bunch.”
Truckers and their industry advocates are waiting for states to take action and for the FTC to finish its junk fee rule. Until then, truckers are at risk of ratcheting up junk fees from predatory towing companies. For now, the best they can do is hope not to run into one of the bad apples.
