*The Executive Summary was replaced in its entirety on December 18, 2024.

Chapter 245 of the Acts of Assembly 2024 Regular Session ("Chapter 245") directs the State Corporation Commission ("Commission") to examine the issue and report its findings. Chapter 245 specifically provides that the Commission:

[E]xamine[s] the existing regulation of fees charged for the removal of motor vehicles, trailers, and parts thereof left on private property in violation of § 46.2-1231 of the Code of Virginia ["Code"] and for the removal of trespassing vehicles under § 46.2-1215 of the Code of Virginia and shall identify policy options for the Commission to assume all or part of such regulation. Such policy options shall include various levels of Commission involvement in such regulation. Each policy option shall identify the necessary statutory and regulatory changes to enact such policy option and shall include the resources needed by the Commission to fulfill its duties under such policy option.

The Commission established a proceeding(*1) for the purpose of inviting public comments to be filed pertaining to the matters and issues described in Chapter 245 and the Commission presents this report ("Report") with its findings and recommendations. The Commission also retained the Eixenberger Group, LLC ("EG") to facilitate the examination of the existing regulation of fees charged for the removal of motor vehicles, trailers, and parts thereof left on private property in violation of the Code sections specified above,(*2) and to make recommendations based on such examination. The Commission is pleased to submit this Report of the Commission's findings to the General Assembly, as directed by Chapter 245.

In addition to the Commission proceeding, EG developed an online survey and attempted to engage 189 towing companies to obtain towing cost information and identify key issues of concern from the perspective and experience of the companies. The responses to the survey questions were compared to previously developed cost estimates to verify assumptions and cost values used in the study. Comments received from stakeholders during the Commission proceeding, as well as information from EG's online survey, were useful in developing the Eixenberger Group Report ("EG Report") and in assisting the Commission in preparing this Report.

After a thorough review of the EG Report and stakeholder comments received, the Commission finds that the following recommended policy options from the EG Report are reasonable for further consideration by the General Assembly:

1. The current maximum allowable rate(*3) of $150 charged by the companies providing the Trespass Tow should be reset based on current cost estimates. A new Trespass Tow base rate between $200 and $210 appears reasonable.

2. The current additional fees for working night shifts, weekends, and holidays(*4) remain reasonable. A change does not appear to be justified at this time.

3. Use a percentage to automatically adjust any minimum rate(*5) or eliminate the minimum entirely. Should a percentage be chosen, a new minimum rate of 75% of the maximum appears reasonable and should apply to all districts.

4. Change the drop fee(*6) to a maximum rate between 40% and 50% of the allowable Trespass Tow rate.

5. Develop a specific definition and formula for threshold situations where a fuel surcharge(*7) would apply and the allowable rates would be updated.

6. The maximum allowable Trespass Tow rate(*8) should be adjusted annually to account for inflation, using the Transportation Consumer Price Index and/or Transportation Producer Price Index as reported by the U.S. Bureau of Labor Statistics.

7. Every 5 to 10 years, a detailed cost review, including a calculation of the current cost to complete a Trespass Tow, should be completed by either the Commission or another agency as designated by the General Assembly.(*9) The fiscal impact to the Commission to hire a consultant every 5 to 10 years to evaluate the sufficiency of the Trespass Tow rate is estimated to cost at least $80,000 in 2024 dollars.(*10)

8. Modify the Code to clarify language in § 46.2-1233.1 that the maximum allowable rate applies to light duty vehicle Trespass Tows with a gross vehicle weight rating up to 10,000 pounds, instead of referencing "passenger car."

The Commission appreciates the opportunity to report on these important issues to the General Assembly.
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(*1) Commonwealth of Virginia, ex rel. State Corporation Commission, Ex Parte: In the matter concerning the regulation of certain towing fees, Case No. PUR-2024-00104, Doc. Con. Cen. No. 240630177, Order Establishing Proceeding (June 21, 2024). Available through https://www.scc.virginia.gov/DocketSearch#/caseDetails/145267.
(*2) These types of tows are commonly referred to as non-consent Trespass Tows ("Trespass Tows").
(*3) Code § 46.2-1233.1 defines and regulates maximum allowable fees that can be charged for private property Trespass Tows.
(*4) Code § 46.2-1233.1 A allows a maximum per-instance fee of $30 for no more than two instances, for a combined maximum of $60.
(*5) Code § 46.2-1233 allows a minimum rate of $135 in Planning Districts 8 and 16.
(*6) Code § 46.2-1231 D allows a $25 drop fee, which appears low compared to other states. A drop fee is applied when a trespassing vehicle has been hooked up but released to the owner prior to towing.
(*7) Code § 46.2-1233.1 C contains the state fuel surcharge clause
(*8) Code § 46.2-1233.1 defines and regulates maximum allowable fees that can be charged for private property Trespass Tows. There is currently no index associated with the maximum allowable fee in the Code.
(*9) Regular review is not currently included in the Code. The Trespass Tow rate has not been adjusted since 2018.
(*10) Over time this estimate may increase.