A move is under way in the Capitol to block local districts across California from levying a fee on out-of-town, at-fault drivers to cover the locals' costs of cleaning up car crashes. The legislative discussion emerges even as a dozen locals already have imposed the charge and others are considering whether to do it.
At issue is what opponents – led by insurers – call the "accident tax," a fee typically ranging from $500 to $2,000 that is levied on motorists who cause accidents – but only if they are from outside the area. Four out of five fees are in the $500 range, according to one billing company.
Foes call the levy an unfair fee and the equivalent of a speed trap, and note that out-of-town drivers who cause accidents are subject to double taxation – once in their home areas, and secondly in the area where the fee is imposed.
But providers of police and fire services – especially those in areas with heavy pass-through traffic – and their allies say it is a fair way to cover their costs and replenish recession-plagued budgets depleted by cuts.
"It is not a revenue generator. We are trying to recover costs for the fire departments. It is revenue neutral. If a person gets into an at-fault accident, the insurance companies raise their rates. That's a fair system. It's a lot fairer than a fire department having to consider reducing the level of services or, more importantly, the timeliness of services," Rick Benner, chief operating officer of Fire Recovery in Roseville, a billing company, said in an earlier interview.
According to an insurance industry-supported Web site, at least 18 states have jurisdictions in which accident fees are charged. In most cases, municipalities contract out with a billing and collection service that collects the money on behalf of the governor – for a fee.
In Florida, legislation to repeal accident fees is moving through the Legislature, and in Arkansas, Gov. Mike Beebe signed legislation to bar the fees.
In California, several local jurisdictions have approved the fee and others, including Fresno, are considering it. In Fresno, such a fee would generate about $550,000 annually, according to local news reports.
Assemblyman Anthony Portantino, D-La Canada, has proposed legislation that would prohibit local agencies from imposing the accident fee. Existing law allows such fees only in the cases of some accidents caused by drunken drivers, motorists who file false police reports and drivers who deliberately drive into flooded areas.
The language in his bill was crafted April 16, rewritten from an earlier measure that dealt with California's open-meeting law. Portantino's bill, AB 1004, has not yet been heard in a committee.
Pinole, Forest Hill Fire Protection District, the town of Penryn, Pioneer Fire Protection District, Nevada County Consolidated Fire District, the City of Upland, the town of Montezuma east of Stockton, Kirkwood, Loomis Fire Protection District, Newcastle and Nevada City all have the fee or are poised to adopt it. Roseville east of Sacramento has approved the fee, but the ordinance has not yet taken effect.
Los Angeles, San Diego, Oakland, Sacramento, Orange, Palm Springs, Ontario and Riverside, are considering it
Nationally, an Indiana-based company called Emergency Services Billing Corp. is advocating for the fee, which it promotes as a sound method for local governments to recover money that otherwise would be lost.
"Keep in mind, every response your department makes lessens the value, safety and life expectancy of your equipment-not including money spent on fuel/maintenance costs," ESBC says on its Web site. "Our services allow you to bill for any auto or trucking response for which your department responds. This payment for your services is typically covered by the insured's auto insurance policy. By not billing, your services will go unpaid, forcing your community to continually subsidize accidents they did not cause."