Judge OKs Fee System for Tow Trucks

SAN FRANCISCO (CN) - State and federal law does not pre-empt San Francisco from charging towing companies for business permits, a federal judge ruled.

Towing vehicles in San Francisco requires a permit under city code, and costs businesses from $217 to $546 a year per tow truck, including $34 for each driver, with "larger amounts for initial applications," according to the San Francisco Chronicle.

The California Tow Truck Association (CTTA) sued the City and County of San Francisco in 2010, claiming the system is pre-empted by the Federal Aviation Administration Authorization Act (FAAAA).

The federal law trumps state and municipal laws on price, route or service of tow trucks, but "expressly preserves state authority to regulate (1) motor vehicle safety, (2) minimum insurance requirements, and (3) the price of non-consensual tows," U.S. District Judge Charles R. Breyer ruled.

Breyer ruled in December 2010 that the FAAAA did pre-empt state and municipal laws. The Tow Truck Association appealed to the 9th Circuit, which remanded with orders to "analyze each challenged provision individually."

The parties filed cross motions for summary judgment, which Breyer granted in part and denied in part.

Breyer preserved the city's permit system, except for the challenged price-cap provision. He found that the system falls within the exceptions provided under the FAAAA and is meant to address real concerns, such as weeding out drivers who could "misbehave" on non-consensual tows.

"The court concludes that the permit fee requirements fall within all three exceptions. They are simply a mechanism for funding the permit system," Breyer wrote. "The permit fee requirements enable the operation of the more direct regulatory mechanisms embedded within the permit system, and thus regulate in the same areas as the permit system itself. The fact that the permit fee requirements regulate somewhat more indirectly is not by itself fatal, for, like the essential permit requirements themselves, they remain 'logically' and 'genuinely' connected to obvious concerns."

Breyer added: "CTTA points to no evidence suggesting an improper motivation for collecting permit fees. Rather, as CTTA appears to acknowledge, the city may only use the permit fees to administer the permit system."

He enjoined the rate cap and severed it from the rest of the system, which "remains undisturbed."

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