Why is Towing So Expensive in San Francisco?

As part of our series Bay Curious, we are answering questions from KQED listeners and readers. This one might stir up lots of emotions for anyone whose car has been towed in San Francisco. Listener Ian Monroe has gone through this experience a couple of times and wanted to know:

Why is towing in San Francisco so expensive?

To find out, I headed to a block-long lot on Seventh Street under Interstate 80. This is where most vehicles towed by the police or San Francisco Municipal Transportation Agency wind up.

Outside, I met Cherish Demins. His car was towed less than an hour earlier in the Financial District, while he was making a quick visit to his office, he said.

The price to get his car back? $483.75.

“It’s the worst day of my life,” said Demins, shaking his head. “They just take your car away and expect you to pay all this money?”

Among people who have had their car towed in San Francisco, Demins is actually lucky. Because he recovered his car so quickly, he paid the minimum charge to get it back.

But that minimum amount is twice as much as drivers in Chicago and Los Angeles pay. To understand why, let’s take a closer look at Demins’ bill.

Breaking Down the Costs

Each bill breaks down into at least two parts: a $220.75 towing fee and an $263 administrative fee. If your car is held for more than four hours, there are also additional storage fees: $57.25 for the first day, and $66.75 for each day after that.

The $220.75 towing fee goes to AutoReturn, a company that works like a middleman between drivers, the city and the 10 towing companies that actually haul your vehicle away.

“The main cost of this business is paying the tow companies for the work they do on commission,” said John Pendleton, co-founder and chief technology officer at AutoReturn.

On average, a tow company earns $80.39 for each vehicle it brings to the lot.

The second-biggest expense for AutoReturn is staff salaries and the third is rent, said Pendleton.

AutoReturn pays nearly $3 million each year in rent for the lot on Seventh Street, which is leased by Caltrans, and a long-term storage facility in Daly City, leased by the SFMTA.

In California, the towing and storage rates are agreed upon between local law enforcement agencies and the towing companies they work with. That has resulted in a patchy network of towing costs throughout the state. In Los Angeles, the towing fee is $121, while in Sacramento, it’s $180.

Drivers in San Francisco may be charged more than drivers in those cities, but prices are similar to other Bay Area cities like Oakland and San Jose. Representatives at various towing companies agree that one of the major costs pushing up their prices is rent for the land they use to store vehicles.

Unpacking the Administrative Fee

Another part of the bill pays the $263 administrative fee imposed by San Francisco.

That money is used to pay the salaries of 382 parking control officers, said Paul Rose, a spokesman for the SFMTA. Yes -- the people in uniforms that give you parking tickets and can have your car towed are having their salaries paid by those tows.

“We have to enforce the rules of the road," said Rose. "We have to make sure our streets can be clean. We have to make sure that our roads are clear of any blockage.”

David LaBua, who wrote a book about parking in San Francisco, estimates that the city has 560,000 cars at any given moment, but only about 440,000 on- and off-street parking spots .

“Parking spaces are so much more valuable,” said LaBua. “It’s just supply and demand. We are the city that has the tightest supply-and-demand ratio.”

And it's getting worse. A recent Matier & Ross column in the San Francisco Chronicle reported that at least 1,595 spaces are scheduled to be removed in the next few years to make the city's streets friendlier to bicyclists, pedestrians and transit.

Adding Insult to Injury for Theft Victims

One major complaint the SFMTA hears is from people whose cars were stolen and then towed, said Rose. When police find stolen vehicles, they notify the owner. If the owner doesn’t arrive to collect the car within 20 minutes, the vehicle gets towed at the owner's expense.

That’s what happened to our listener Ian Monroe. He owns an old Honda Civic with a big dent on the side. He thought nobody would steal it -- but he was wrong. His car was stolen twice, once from Noe Valley and once from the Castro.

“In both cases my car was missing for a few weeks and it was eventually found because of parking tickets it had accumulated,” said Monroe, a Stanford University visiting scholar and lecturer on energy and climate. “And I was only told it was found after it had been towed and put on impound, in one case for several days.”

The towing and storage bills totaled over $800, said Monroe, who purchased his car for about $1,800.

“You know, I’m a citizen of the city. I just had my car stolen, which really sucked, and that definitely was a hardship,” said Monroe. “But I ended up being a lot more pissed off at the city for the hefty bill that they are giving me for towing and impound, without giving me any chance to get my vehicle once it was found.”

Some Cars Aren't Worth Retrieving

Fees can add up to more than the car is worth, so some people just surrender their title to the towing company, which then sells the vehicle at an auction sale to recover the towing and storage fees.

San Francisco Supervisor Scott Wiener said that can hurt people’s livelihoods.

“In fairness, San Francisco is a more expensive place to do business than other parts of the state,” said Wiener. “But I think we should look for ways to try to reduce the burden on people whose cars are towed.”

Wiener held hearings last year on the topic, and authored a resolution requesting the fees be reduced or waived for car theft victims.

“You have people who have been victimized by someone stealing their car and then they get victimized again by not being able to recover their car unless they pay a lot of money,” Wiener said.

The city’s contract with AutoReturn is up for renewal by the Board of Supervisors this summer, and changes to the towing fees could be on the table. Wiener said he will not support a new contract unless it offers relief for victims of car theft. He said the grace period for owners to recover their vehicles from the SFPD should be extended -- to several days or a week.