The Car and Truck Fleet and Leasing Management Magazine

More Fleets Seek Reimbursement of Parking and Toll Violations from Drivers

April 2006, by Mike Antich - Also by this author

“A growing trend is for fleet managers to go after drivers for reimbursement of fines and late payment penalties, where in the past they had not,” said Dan Chengary, account manager for Wheels Inc. “Fleet managers are paying more attention to violations, especially at sales fleets, where by the nature of the work, violations are more likely to occur.” The one exception is executive fleets, which continue to be verboten territory for parking and toll violation enforcement. Vehicle violations represent 1 to 3 percent of total fleet costs and vary by fleet depending on the cities and states where its vehicles operate. Sometimes driver violations are egregious. It is not uncommon for some drivers to incur as much as $6,000 worth of tickets on an annual basis. “The cheapest ticket in New York City is $35 and if the ticket goes into default, the amount doubles until it caps out at $135,” said Tim Delaney, manager of license & title for ARI. Some scofflaw drivers believe that parking tickets are the cost of doing business, especially in New York City. Sometimes the cost of a ticket for double parking is less expensive than parking in a garage. Other times it is expedient because of the lack of parking. At the height of the workday, it is not uncommon to find garages filled. Another reason violations are on the radar screens of fleet managers is due to the aggressive enforcement by municipalities and other jurisdictions. “In the past 15 months, we have seen an increase in the number of parking tickets issued,” said Lisa Nickerson, title and license manager, overseeing the violations area for GE Commercial Finance Fleet Services. “We have also noticed an increased effort by jurisdictions to go after unpaid tickets, typically as far back as 10 years.” Prompting this resurfacing of old tickets is that many states have combined delinquent ticket data into a single database. “Many jurisdictions within a state operate independent of the state DMV. Now these jurisdiction databases are being merged into the state DMV database making it easier to identify and collect on unpaid tickets,” added Nickerson. Over the years, many jurisdictions have come to rely on the revenue stream of traffic violations to balance budgets. These jurisdictions engage in aggressive enforcement of traffic and parking violations. A case in point is New York City. Last year alone, New York City issued two million parking tickets to commercial vehicles that totaled more than a half billion dollars. Volume of Toll Violations is Growing Fast
Ten years ago, toll violations were an insignificant expense for fleets. Today, it is the second fastest growing cost for fleets. The proliferation of automated tollbooths has dramatically increased the volume of toll violations. Last year, more than 40 percent of all fleet violations were toll violations. As more automated toll systems are introduced nationwide, the volume of violations promises to increase. Typical reasons for toll violations are expired credit cards, dead transponder batteries, not transferring the transponder to a replacement vehicle, or failure to report the replacement vehicle’s license plate number to the toll authority. These simple mistakes can be costly. For instance, if an employee drives through five tollbooths on the way to work and the same five back home, during the course of a month that driver has incurred a minimum of 200 toll violations without knowing it. It is not uncommon for drivers to accumulate hundreds of dollars worth of toll violations and penalties.

The 80/20 Rule Applies
Many fleets do not have a written fleet policy specific to driver reimbursement of parking ticket and toll violations. “As jurisdictions become more aggressive in collection of unpaid fines, more fleet managers will be forced to deal with this issue because the dollar cost for these violations will creep up to where it will catch senior management’s attention,” said Delaney. Some fleets deduct parking and toll violations from a salesperson’s expense report, said Delaney. Other fleets require drivers to write a personal check reimbursing the company. Besides recouping lost revenue, a side benefit to reimbursement of violations is a decrease in the number of future tickets. “Fleet managers who adopt a driver reimbursement policy for violations report a significant decrease in the volume of violations. Drivers who know they will be held financially accountable tend to be more careful or pay a ticket before it becomes delinquent,” said Nickerson.

When identifying violators, invariably the 80/20 rule applies. “In some cases it is even higher,” said Chengary. “For some fleets, as much as 85 percent of the violations are incurred by 15 percent of the drivers.” Many of these are the top salespeople, whose violations are ignored, creating an inequality in policy enforcement. Are they any different than the driver who blows an engine because he or she never changed the oil? Why should one be treated differently than the other? The answer is they shouldn’t. Let me know what you think.
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