Resolution 2020-31501 RESOLUTION NO. 2020-31501
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF
THE CITY OF MIAMI BEACH, FLORIDA, CONTINUING TO
EXTEND THE CURRENT TOWING PERMITS WITH THE CITY'S
TWO (2) TOWING PERMITTEES, BEACH TOWING SERVICES,
INC. AND TREMONT TOWING, INC., RESPECTIVELY, WHICH
ARE CURRENTLY SET TO EXPIRE ON NOVEMBER 28, 2020;
EXTENDING BOTH PERMITS ON A MONTH-TO-MONTH BASIS,
FOR UP TO THREE (3) MONTHS AFTER THE EXPIRATION DATE
(OR FEBRUARY 28, 2021).
WHEREAS, on January 15, 2020, the City Commission adopted Resolution No.
2020-31147, urging the City's Inspector General (IG) to take the following actions
regarding the audits performed on the City's two (2) towing permittees, Beach Towing
Services, Inc., and Tremont Towing Services, Inc.:
(1) transmit the draft audit reports to the towing permittees, and allow the
permittees to provide any comments, in writing, to the IG; and
(2) following the "comment period" deadline, requesting that the IG take such
action(s) as necessary to finalize the audits (incorporating, as the IG
deemed necessary, any comments provided by the towing permittees); and
(3) requesting the IG to place a follow-up discussion item regarding the final
towing audit reports on the City Commission agenda; and
WHEREAS, the Resolution also extended both permittees' towing permits, which
were set to expire on February 28, 2020, on a month-to-month basis, for up to six (6)
months after the expiration date (or August 28, 2020); and
WHEREAS, on July 29, 2020, the City Commission adopted Resolution No. 2020-
31371 , further extending the towing permits on a month to month basis, up to three (3)
months after the expiration date of August 28, 2020 (or November 28, 2020), to allow for
updated towing permits incorporating the IG's recommendations; and
WHEREAS, the IG's report regarding the towing permit audits was finalized on
September 24, 2020; and
WHEREAS, in order to continue to enable the Police and Parking Departments to
tow vehicles on public property, as deemed necessary and required, the Administration
recommends continuing to extend both towing permits, on a month-to-month basis for up
to three (3) months, or until February 28,2021 , to allow the Administration to thoroughly
review and incorporate the IG's recommendations.
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City
Commission hereby extend the current tow permits with the City's two (2) towing
permittees, Beach Towing Services, Inc. and Tremont Towing, Inc., respectively, which
are currently set to expire on November 28, 2020; extending both permits on a month-to-
month basis, for up to three (3) months after the expiration date (or February 28, 2021).
nti
PASSED AND ADOPTED this i'Y day of ul�hPr , 2020.
ATTEST:
/42-19
Dan Gelber, Mayor
21
lIcare
Ra ael E. Granado, ity Clerk
IN(®RP ORATED
t:\agenda\2020\11 november 18\parking\towingextension reso.docx APPROVED AS TO
FORM & LANGUAGE
&FOR EXECUTION
to
L
City Attomey Date
Resolutions - R7 F
MIAMI BEACH
COMMISSION MEMORANDUM
TO: Honorable Mayor and Members of the City Commission
FROM: Jimmy L. Morales, City Manager
DATE: November 18, 2020
SUBJECT:A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY
OF MIAMI BEACH, FLORIDA, CONTINUING TO EXTEND THE CURRENT
TOWING PERMITS WITH THE CITY'S TWO (2) TOWING PERMITTEES,
BEACH TOWING SERVICES, INC. AND TREMONT TOWING, INC.,
RESPECTIVELY, WHICH ARE CURRENTLY SET TO EXPIRE ON
NOVEMBER 28, 2020; EXTENDING BOTH PERMITS ON A MONTH-TO-
MONTH BASIS, FOR UP TO THREE (3) MONTHS AFTER THE
EXPIRATION DATE (OR FEBRUARY 28, 2021).
RECOMM ENDAT ION
Adopt the Resolution.
BACKGROUND/HISTORY
On January 15, 2020, the City Commission adopted Resolution No. 2020-31147, urging the
City's Inspector General (IG) to take the following actions regarding the audits previously
performed on the City's two (2) towing permittees, Beach Towing Services, Inc., and Tremont
Towing Services, Inc.: (1)transmit the draft audit reports to the towing permittees, and allow the
permittees to provide any comments, in writing, to the IG; and (2) following the "comment
period" deadline, requesting that the IG take such action(s) as necessary to finalize the audits,
(incorporating, as the I G deems necessary, any comments provided by the towing permittees);
and (3) requesting the IG to place a follow-up discussion item regarding the final towing audit
reports on the City Commission agenda. The City Commission also extended the towing
permits, which were set to expire on February 28, 2020, on a month-to-month basis for up to six
(6) months, or until August 28, 2020. The Resolution is attached as Exhibit "A" to this
Memorandum.
On July 29, 2020, the City Commission adopted Resolution No. 2020-31371, continuing to
extend the towing permits, on a month to month basis, up to three (3) months after the expiration
date of August 28, 2020 (or November 28, 2020), to allow for updated permits incorporating the
IG's recommendations.
The IG's reports (copies of which are attached as, respectively, Exhibits "B", "B-1" [Tremont
Audit], and "B-2" [Beach Towing Audit] to this Memorandum) were finalized on September 24,
Page 989 of 1430
2020. Therefore, another three (3) month extension is requested to incorporate the
recommendations of the I G report into the new towing permits.
ANALYSIS
The current month-to-month extension, will expire on November 28, 2020. I n order for the
Police and Parking Departments to continue to be able to tow vehicles on public property, as
deemed necessary and when required, the Administration recommends further extending the
towing permits, on a month-to-month basis for up to three (3) months, or until February 28,
2021, to allow the Administration to incorporate the I G's recommendations, and place a
discussion item on a future City Commission agenda.
CONCLUSION
The Administration recommends further extending the towing permits of both towing permittees,
on a month-to-month basis from November 28, 2020, for up to three (3) months, or February 28,
2021, to allow Administration to incorporate the I G's recommendations and place a discussion
item on a future City Commission agenda.
Applicable Area
Citywide
Is this a "Residents Right Does this item utilize G.O.
to Know" item. pursuant to Bond Funds?
City Code Section 2-14?
Yes No
Legislative Tracking
Parking
ATTACHMENTS:
Description
D Exhibit"A" - Resolution No. 2020-31147
❑ Exhibit"B" - OIG Report Parking & Police
❑ Exhibit "B-1"- OIG Report Tremont
❑ Exhibit"8-2"- OPIG Report Beach
o Resolution
Page 990 of 1430
Exhibit "A"
RESOLUTION NO. 2020-31147
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE
CITY OF MIAMI BEACH, FLORIDA, URGING THE CITY'S INSPECTOR
GENERAL ("IG") TO TAKE THE FOLLOWING ACTIONS REGARDING
THE INTERNAL CITY AUDITS PREVIOUSLY PERFORMED ON THE
CITY'S TWO (2) TOWING PERMITTEES, BEACH TOWING SERVICES,
INC., AND TREMONT TOWING, INC. (WHICH AUDITS ARE STILL IN
"DRAFT", NON-FINAL FORM): (1) TRANSMIT THE DRAFT AUDIT
REPORTS TO THE TOWING PERMITTEES, AND ALLOW THE
PERMITTEES TO PROVIDE ANY COMMENTS, IN WRITING, TO THE IG
NO LATER THAN FEBRUARY 1ST, 2020; (2) FOLLOWING THE
FEBRUARY 1ST "COMMENT PERIOD" DEADLINE, REQUESTING
THAT THE IG TAKE SUCH ACTION(S) AS NECESSARY TO FINALIZE
THE AUDITS, (INCORPORATING, AS THE IG DEEMS NECESSARY,
ANY COMMENTS PROVIDED BY THE TOWING PERMITTEES), BY A
DATE NO LATER THAN FEBRUARY 10, 2020; AND (3) REQUESTING
THE IG TO PLACE A FOLLOW-UP DISCUSSION ITEM REGARDING
THE FINAL TOWING AUDIT REPORTS ON THE FEBRUARY 12, 2010
CITY COMMISSION AGENDA; AND FURTHER EXTENDING CURRENT
TOWING PERMITS OF THE TOWING PERMITTEES, CURRENTLY SET
TO EXPIRE ON FEBRUARY 28, 2020, ON A MONTH-TO-MONTH BASIS
FOR UP TO SIX (6) MONTHS AFTER THE EXPIRATION DATE.
WHEREAS, on or about December, 2018, the City of Miami Beach Internal Auditor
(the "City Auditor")and his staff undertook an audit of the City's two (2)towing permittees,
Beach Towing Services, Inc., and Tremont Towing, Inc. (hereinafter, the "Towing
Permittees"); and
WHEREAS, nearing the end of his auditing process, the City Auditor met with
representatives of the Towing Permittees on March 11, 2019, and May 16, 2019, to
discuss the draft audit reports (hereinafter, the "Draft Audit Reports"), and to receive
feedback, suggested revisions, and/or other comments, as is customary during the City's
internal auditing process; and
WHEREAS, on April 30, 2019, the Miami New Times contacted the City requesting
a copy of the Draft Audit Reports, and was informed that such Reports were still in
progress; not yet finalized; and, therefore, not subject to disclosure under Florida Public
Records law; and
WHEREAS, at the June 5, 2019 City Commission meeting, the Towing Permittees,
through their representatives, appeared before the City Commission to request that, in
lieu of finalizing the Draft Audit Reports, the City retain an outside independent auditing
firm to conduct an audit of the Towing Permittees (with such outside auditor to be
contracted by the City, and paid for by the Towing Permittees); and
Page 991 of 1430
WHEREAS, following the discussion, the City Commission voted 4-3 to suspend
the City's internal audit (in progress), and hire an outside auditing firm; and
WHEREAS, in accordance with the City Commission's direction, on or about
October, 2019, the City entered into a contract with RSM US LLP to perform the outside
independent audit of the Towing Permittees; and
WHEREAS, although the independent audits were to have been completed by
December 31, 2019, they have not yet commenced; and
WHEREAS, on November 4, 2019, the Miami New Times initiated a lawsuit
against the City to compel the City to release the Draft Audit Reports; and
WHEREAS, on November 14, 2019, the Eleventh Circuit Court for and in Miami-
Dade County ruled for the Miami New Times, ordering the City to provide the Miami New
Times with the Draft Audit Reports of its internal auditor; and
WHEREAS, the City appealed the ruling to the Third District Court of Appeal, and
filed a motion to stay the Lower Court's order, which was granted on November 19, 2019;
and
WHEREAS, the litigation is still pending; and
WHEREAS, in addition, following successful passage of a ballot question on
November 5, 2019, the Mayor and City Commission amended the City Charter to provide
for the creation of a City of Miami Beach Office of Inspector General ("IG"), to perform,
among other things, investigations, audits, reviews, and oversight of municipal matters;
and
WHEREAS, considering (i) the costly public records lawsuit currently pending in
the Third District Court of Appeal; (ii)the establishment of the Office of Inspector General;
(iii) the fact that the Draft Audit Reports prepared by the City's Internal Auditor were near
completion; and (iv) the outside independent audits have not even commenced, at this
time it would be in the best interest of the City to finalize the Draft Audit Reports previously
prepared by the Internal Auditor; and
WHEREAS, it is imperative that the City proceed to finalize the Draft Audit Reports,
not only in light of the aforestated litigation, but because the City's towing permits with the
Towing Permittees expire on February 28, 2020, and the City Commission should be able
to consider the results and findings of the audit reports prior to, and as a component of,
whether to renew the towing permits with the Towing Permittees; and
WHEREAS, furthermore, the City's current towing permits with the Towing
Permittees, which are set to expire on February 28, 2020, should be extended on a
month-to-month basis for up to six months after the expiration date.
Page 992 of 1430
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City
Commission hereby urge the City's Inspector General ("IG") to take the following actions
regarding the internal City audits previously performed on the City's two (2) towing
permittees, Beach Towing Services, Inc., and Tremont Towing, Inc. (which audits are still
in "draft", non-final form): (1) transmit the draft audit reports to the Towing Permittees,
and allow the permittees to provide any comments, in writing, to the IG no later than
February 1st, 2020; (2) following the February 1st "comment period" deadline, request
that the IG take such action(s) as necessary to finalize the audits, (incorporating, as the
IG deems necessary, any comments provided by the Towing Permittees), by a date no
later than February 10, 2020; and (3) request the IG to place a follow-up discussion item
regarding the final towing audit reports on the February 12, 2010 City Commission
agenda; and further extend current towing permits of the Towing Permittees, currently set
to expire on February 28, 2020,on a month-to-month basis for up to six (6) months after
the expiration date.
PASSED AND ADOPTED this day of 7441/414 r 020.
r11,
ATTEST: —`L - • -..
Dan G.R'r, Mayor
I272me
Rafael . Granado, ity lerk
(Sponsored by Commissioner David Richardson)
INCORP ORATED s
t- 1�:. 0
"•"`` APPROVED AS TO
FORM & LANGUAGE
.,&FOR EXECUTION
ciR II_ SS' i--- 1 — ( 6 — 2-1)
City Attorney Date
Page 993 of 1430
Resolutions -R7 M
MiAMI BEACH
COMMISSION MEMORANDUM
TO: Honorable Mayor and Members of the City Commission
FROM: Raul J.Aguila, City Attorney
DATE: January 15, 2020
SUBJECT:A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY
OF MIAMI BEACH, FLORIDA, URGING THE CITY'S INSPECTOR
GENERAL ("IG") TO TAKE THE FOLLOWING ACTIONS REGARDING THE
INTERNAL CITY AUDITS PREVIOUSLY PERFORMED ON THE CITY'S
TWO (2) TOWING PERMITTEES, BEACH TOWING SERVICES, INC., AND
TREMONT TOWING, INC. (WHICH AUDITS ARE STILL IN "DRAFT", NON-
FINAL FORM): (1) TRANSMIT THE DRAFT AUDIT REPORTS TO THE
TOWING PERMITTEES, AND ALLOW THE PERMITTEES TO PROVIDE
ANY COMMENTS, IN WRITING, TO THE IG NO LATER THAN FEBRUARY
1ST, 2020; (2) FOLLOWING THE FEBRUARY 1ST "COMMENT PERIOD"
DEADLINE, REQUESTING THAT THE IG TAKE SUCH ACTION(S) AS
NECESSARY TO FINALIZE THE AUDITS, (INCORPORATING, AS THE IG
DEEMS NECESSARY, ANY COMMENTS PROVIDED BY THE TOWING
PERMITTEES), BY A DATE NO LATER THAN FEBRUARY 10, 2020; AND (3)
REQUESTING THE IG TO PLACE A FOLLOW-UP DISCUSSION ITEM
REGARDING THE FINAL TOWING AUDIT REPORTS ON THE FEBRUARY
12, 2010 CITY COMMISSIONAGENDA.
RECOMMENDATION
Pursuant to the request of Vice-Mayor David Richardson, the above-referenced Resolution is
submitted for consideration by the City Commission at the January 15, 2020 Commission
meeting.
Applicable Area
Not Applicable
Is this a Resident Right to Does this Item utilize G.O.
Know item? Bond Funds?
No No
Legislative Tracking
Office of the City Attomey
Sponsor
Page 1374 of 1618
Page 994 of 1430
Vice-Mayor David Richardson
ATTACHMENTS:
Description
o Resolution
Page 1375 of 1618
Page 995 of 1430
Bk-"-.
\\'`
Exhibit "B"
\P €- •,q �
y�� r
`F' TOA �c
G
Joseph M. Centorino, 'nspector General
TO: Honorable Mayor and Members of the City Commission
FROM: Joseph Centorino, Inspector General
DATE: September 24, 2020
AUDIT: Parking and Police Department Requested Tows Operational Audit
OIG No. 20-13
PERIOD: October 1, 2017 to October 31, 2018
This report is the result of a request made by the City Administration in November 2018 to verify
Beach Towing Services, Inc.'s (Beach Towing) and Tremont Towing, Inc.'s (Tremont Towing)
compliance with selected provisions in the City of Miami Beach Administrative Rules and
Regulations for Police and Parking Towing Permits (Towing Permits) in effect during the audit
period. Meetings were held in December 2018 with the tow companies and applicable Parking,
Police and Finance Department staff to gain an understanding of each company's operations and
to request relevant documents,
Although the reviewed Towing Permits contain a myriad of points that require compliance from
the two tow companies, Office of the Inspector General (OIG) staff concentrated its testing on the
accuracy of the City's monthly billings and the amounts charged to tow customers. To help
achieve these objectives, we reviewed the written Standard Operating Procedures, records of
work performed, available body camera footage, documentation received from the City's Parking,
Police and/or Finance Departments, and copies of the tow slips received from the tow companies.
As this audit was nearing completion, the City Commission voted in favor of terminating the audit
at its June 5, 2019 meeting and all work on this and related audits was immediately stopped. This
audit's termination was subsequently re-visited at the January 2020 Commission meeting wherein
it was determined that the newly created Office of the Inspector General, as an independent body,
had the authority to conclude the audit within its broad discretion to audit, investigate and review
City operations and contracts.
Consequently, the auditing work was subsequently resumed, resulting in the completion of three
separate audit reports, including this one. The remaining two audit reports address the testing
performed relative to Beach Towing Services, Inc. (Beach Towing) and Tremont Towing, Inc.
(Tremont Towing). Although the work performed was reported separately, there may be some
overlap In the three reports, as noted shortcomings could involve more than one of the parties
involved.
ACRONYMS
CAD = Computer Aided Dispatch
LERMS = Law Enforcement Records Management System
PES = Parking Enforcement Specialist
PET = Property and Evidence Technician
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Page 996 of 1430
PEU = Property and Evidence Unit
PSCU = Public Safety Communications Unit
VRO = Vehicle Research Office
VSR = Vehicle Storage Receipt
VTL = Vehicle Tow Log
INTRODUCTION
Chapter 106, Article V, of the Miami Beach City Code, provides for the issuance of towing permits
for the towing of vehicles identified by the City's Parking and Police Departments as requiring
removal from public and private property, as well as vehicle impoundments. The same two tow
companies, Beach Towing and Tremont Towing, have continued to operate exclusively in Miami
Beach since at least their selection based on their response to Request for Proposals No. 1-91/94.
The negotiated towing permits for the two companies have been revised as needed in the
following years.
More recently, City Resolution 2015-28918 was adopted on February 11, 2015, approving the
issuance of new Towing Permits to Beach Towing and to Tremont Towing for a three-year term
commencing on March 1, 2015, and expiring on February 28, 2018. Both companies' terms were
extended for an additional one year through February 28, 2019 with the passage of City
Resolution No. 2018-30161.
The City Commission approved a one-year extension for both tow companies under the same
terms except for a reduction of their charged automated teller machine fees at the December 12,
2019 meeting. Although this extension expired in February 2020, both Beach Towing and
Tremont Towing are continuing to operate on a month-to-month basis under its terms.
Among other provisions, Section 3 of the Towing Permits includes the following:
"The City shall bill Permittee (Beach Towing and Tremont Towing) by the 10th of each month for
all tows occurring in the previous month. A late charge of $50 plus the greater of (i) eighteen
percent (18%) interest per annum or (ii) the maximum rate allowable under Florida law shall be
assessed on all payments received after the 20th day of the billing month". In addition, Section
22 lists the following approved maximum towing rates:
Class "A" Tows: $140* Mileage/Mile (max: $42): $6
Class "B" Tows: $145* Labor to Engage/Tow: $30
Class "C" Tows: $175* Outside Storage (per day): $30
Class "D" Tows: $200** Indoor Storage (per day): $35
Administrative Fee: $35 After Hours Fee: $30
Dollies or Flatbed Services: $40
As defined in Section 11 of the Towing Permits, the hook-up fees are charged based on the following gross
vehicle weights:
Class"A" wreckers and slide back car carriers-commercially manufactured unit, with a rated capacity of not
less than 10,000 pounds
Class"B"wreckers-commercially manufactured units, with a rated capacity of not less than 18,000 pounds
Class "B" slide back car carriers — commercially manufactured unit, with a rated capacity of not less than
20,000 pounds
Class"C"wreckers—commercially manufactured unit,with a rated capacity of not less than 36,000 pounds
Class"D"wreckers-not specifically addressed in the Towing Permits,but it was assumed they would contain
a rated capacity of more than 36,000 pounds(the maximum weight limit for Class"C" wreckers).
Lastly, drop fees are to be waived when a vehicle owner arrives on the scene of a tow and the
vehicle has been engaged (hooked) by the tow truck, but the tow truck has not left the scene.
Although Florida law allows tow companies to assess a drop fee of not more than 50% of the
Page 2 of 23
Page 997 of 1430
posted towing rates, it has been agreed that all drop fees will be voluntarily waived on Miami
Beach per Section 24 of the Towing Permits.
The following sections provide an overview of the City procedures established and to be followed
by staff depending on whether it is a Parking or Police Department requested tow:
A. Parking Department Requested Tows
A Parking Department requested public property tow occurs when a vehicle is illegally
parked in a City street, City parking lot, garage or other public right-of-way. A parking
citation is also issued stating the violation. The most common reasons for a public
property tow are prohibited parking (parking in fire lanes/hydrants, cross walk, double-
parking); restricted parking; or illegally parking in a handicap accessible parking spot,
residential parking zone or loading zone.
Vehicles may also be towed because of unpaid parking violations. All associated fees
must be paid in full before the owners can pick up their impounded vehicles.
Parking tows are initiated by a Parking Enforcement Specialist (PES) and are reported to
the Dispatcher who records the information in a Vehicle Tow Log (VTL). The VTL is used
to temporarily maintain the vehicle information and to log the call until the vehicle has been
towed away for the convenience of the Dispatcher. The VTL also aids in facilitating an
equal rotation between the two tow companies as initial dispatch calls to Beach Towing
and Tremont Towing are to be alternated.
The Dispatcher then enters the vehicle information into the Law Enforcement Records
Management System (LERMS) which is used to generate a sequential tow number. This
number is used by the PES to create the Vehicle Storage Receipt (VSR). The Dispatcher
subsequently contacts the authorized tow company per the rotation. At the scene of the
tow, the PES obtains the signature of the tow company representative on the VSR. Each
tow company is provided with a copy of the completed VSR. At the end of each month,
the Parking Enforcement Manager is to generate a Computer Aided Dispatch(CAD) report
to review any significant differences in the number of tows between the two tow
companies.
At least once a week, the Parking Department Enforcement Supervisors pick up the VSRs
together with storage payment receipts and photocopies of personal identification
provided by the individuals who picked up the impounded vehicles from both towing
companies. These documents are subsequently delivered to the Parking Department's
Coin Room staff where they get filed and maintained numerically by date and by tow
company.
On a weekly basis, a tow report is generated from LERMS which documents the data from
all the tows that Dispatch radioed in for that week for each tow company. This report is
emailed to the Coin Room staff in Excel format, which pulls the filed VSRs and matches
them to the LERMS report, noting any "no charge" tows as well as highlighting any Miami
Beach resident tows.
A few examples of"no charge"tows include City requests that certain individuals not have
to pay the associated fees due to their being crime victims, or when inadvertent mistakes
are made, and the vehicle improperly towed. Otherwise, the City is to be reimbursed either
$20 for abandoned vehicles, $25 for Miami Beach residents' vehicles and $30 for all other
tows in accordance with the Towing Permits. To prove residency, both the individual's
driver's license address and registration must match a valid Miami Beach address.
If the VSR from the tow company and the report match, it is considered a "good tow". Any
Page 3 of 23
Page 998 of 1430
discrepancies are to be resolved by calling the pertinent tow company and/or the
Enforcement Supervisor. Once all discrepancies are resolved and the numbers of tows
are agreed upon, the Parking Department's Coin Room staff send the updated and
reconciled CAD Excel report to the designated Office Associate IV for review and to
prepare the monthly invoices. Once created, the Office Associate IV is to post the invoices
in the City's Financial System for each tow company by the tenth day of each month. The
Office Associate IV emails the monthly invoices to the respective tow company and is to
periodically follow-up on any outstanding invoices.
B. Police Department Requested Tows
Police officers or authorized non-sworn Police Department employees possess legal
authority to remove vehicles/vessels from roadways/waterways and public property when
the vehicle is parked illegally and obstructs traffic, parked in a handicap space, severe
injury or death to the driver/occupant occurred from a traffic accident, the vehicle does not
have a license tag or it was stolen and/or used in the commission of a crime. A more
comprehensive listing can be found in the Police Department's Standard Operating
Procedure #133, Section I entitled "Legal Authority".
When the Police Department employee determines that a vehicle is to be towed or impounded,
he/she will inspect the vehicle and visually determine the vehicle identification number and the
license tag number. This information is then called into the Public Safety Communications Unit
(PSCU) to determine the name and address of the owner and the vehicle's status. Next, they will
complete a VSR which contains the name, address and phone number of the registered owner
and/or driver, the date, time, location and reason for the tow, the applicable case number, the
vehicle information, notation of any interior or exterior vehicle damage, inventory of all items
present, among other information.
Then the employee is to contact the PSCU and request a contracted tow truck from either Beach
Towing or Tremont Towing based on their rotation, including any need for special equipment(e.g.
car-carrier, heavy-duty trucks). The VSR should contain documentation as to the reasons for any
special requests or additional labor charges, like the use of a dolly or flatbed or unlocking and
entering the vehicle. Once the VSR is completed and prior to returning to service, all relevant
information is to be provided to the PSCU.
In addition, a hold could be placed on a vehicle if it was used in the commission of a crime or is
considered evidence. All holds require a supervisor's signature on the VSR and it is the police
officer's responsibility to contact the specific entity and to advise them that there is a hold on the
vehicle. The assigned investigator is then to write a Supplemental Report within five days
indicating either release of the vehicle or the supervisor-approved reasons for continuing the hold.
Also, the vehicle is to be removed from the tow lot and transported to the Police Department's
impound area by the applicable tow company.
The Police Department's Vehicle Research Office (VRO), comprised of a collaborative effort
between the Property and Evidence Unit(PEU) and the PSCU, is responsible for ensuring a VSR
is received for all towed vehicles and that all information has been provided to the PSCU,
confirming that the tow companies are meeting their contractual obligations, providing a central
location for all inquiries concerning impounded and towed vehicles. Immediately following the
end of each month, the PEU is to generate a report of all contracted tows occurring during the
specified month which is to be timely forwarded to the Finance Department for invoicing by the
tenth of the month. Lastly, the tow companies are to remit their corresponding payment of the
invoice by the twentieth of the month or the designated late charges are to be levied.
Page 4 of 23
Page 999 of 1430
OVERALL OPINION
The same two tow companies have operated exclusively in Miami Beach since at least their
selection based on their response to Request for Proposals No. 1-91/94. Similarly, several key
City staff members have been tasked with dealing with these tow companies for many years.
Although staff longevity and experience may be of some value, there appears to have developed
some complacency in enforcement of some of the terms in the City Towing Permits, as well as
insufficient oversight of the towing companies. In addition, the latest technology has not been
fully embraced, as most of the forms reviewed are prepared manually, which increases the
possibility of inadvertent errors/omissions, incorrect billings, and makes difficult the review and
analysis of these data at large scale.
The following shortcomings were noted during testing that are in need of corrective action by the
City:
1. Parking and Police Department's requested tows were not properly billed during the audit
period resulting in an estimated underbilling of$24,822 ($21,577 for Parking + $3,245 for
Police).
2. 12 of 26 tested Police Department billings were prepared after designated due dates per
Towing Permit Section 3 (46.15°/x), and they consistently listed incorrect due dates.
3. The current Towing Permits contain some contradictory wording which created confusion
as to their interpretation. Additional recommended terminology should be included in the
next negotiated Towing Permits.
4. Formal complaint logs were not maintained by the City's Parking and Police Departments,
which impeded verification that the appropriate actions stated in Section 29 of the Towing
Permits were timely performed.
5. The tow truck operator's arrival time was not recorded for Police Department requested
tows, creating an obstacle in determining compliance with Section 14 of the Towing
Permits, which requires a 20-minute response time.
6. The Parking Department should maintain adequate documentation as to the reasons why
the tow companies were not alternated to help prevent possible future disagreements.
7. Parking and Police Department staff were unaware that the tow companies did not
maintain the required insurance coverage in accordance with Section 4 of the Towing
Permits and their information was not uploaded into Exigis, LLC's software to facilitate
monitoring.
8. Several other Parking Department deficiencies are addressed.
SCOPE, OBJECTIVES, AND METHODOLOGY
The scope of this audit included an examination of the procedures and controls over the City's
collection processes for administrative towing fees, controls/oversight of towing companies'
activities and their compliance with selected terms set forth :n the Towing Permits. The audit
covered the period of October 1, 2017 through October 31, 2018 and it focused primarily on
determining the Parking, Police and Finance Department's compliance with the following
objectives:
• To determine whether the City accurately and timely invoiced the two tow companies.
• To determine whether the two towing companies' payments were received in full before
the Towing Permits' established due dates. If not, determine whether late charges were
accurately billed.
• To determine whether tow complaints received were sufficiently and timely resolved
• To determine whether tested tow truck operators arrived within the twenty (20) minute
established goal.
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• To determine whether the City properly alternated between the two tow companies on all
requested public tows.
• To determine whether the two tow companies attained the required annual Business Tax
Receipt certificates from the City.
• To determine whether the two tow companies maintained the required insurance
coverage.
• To determine whether Police Department holds were properly documented in accordance
with Section 6 of the Towing Permits.
• Other procedures as deemed necessary.
We conducted this audit in accordance with the office's Standard Operating Procedures. Those
require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a
reasonable basis for our findings and conclusions based on our audit objectives. We believe that
the evidence obtained provides a reasonable basis for our findings and conclusions based on our
audit objectives.
The audit methodology included the following:
• Reviewed applicable provisions within the Towing Permits and Code of Ordinances, and
City Standard Operating Procedures;
▪ Interviewed and made inquiries of City and external companies' personnel in order to gain
an understanding of the internal controls (relative to the operations of the towing services),
assess control risk, and plan audit procedures;
• Performed substantive testing consistent with the audit objectives, including but not limited
to, examination of applicable transactions and records on a statistical and non-statistical
sample basis;
• Drew conclusions based on the results of testing, made corresponding recommendations,
and obtained auditee responses and corrective action plans; and,
• Other audit procedures as deemed necessary.
FINDINGS, RECOMMENDATIONS AND MANAGEMENT RESPONSES
Finding #1: City Requested Tows were Not Properly Billed
The Towing Permits detail the terms and conditions with which Beach Towing and Tremont
Towing were to comply during the October 1, 2017 through October 31, 2018 audit period. One
tested provision, Section 3, provides that the tow companies are to pay the City a monthly fee of
$25 for tows of Miami Beach residents' vehicles and $30 for all other vehicles towed. Exceptions
noted in the Towing Permits include Section 20, which requires the tow companies to provide
emergency towing services for City vehicles at no charge, and Section 21 which requires them to
pay the City $20 for every towed abandoned vehicle.
a. Parking Department Requested Tows
The Parking Department's Senior Management Analyst created an Excel spreadsheet based
on a daily download of Law Enforcement Records Management System (LERMS) data for
each Parking Department requested tow. This report contains such information as the
sequential impounded vehicle number, the date/time that the vehicle was impounded, the
location from which the vehicle was towed, the corresponding tow company used, the
impounded vehicle's license plate and the reason it was impounded.
Afterwards, Coin Room staff manually enter a detailed breakdown of all the individual amounts
charged to each tow vehicle owner for storage fees, mileage charges, administrative fees,
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after hours fees, labor to engage/tow vehicle fees, state sales taxes, among other entries into
this spreadsheet. OIG staff verified that all the sequential impounded Parking Department
vehicle numbers were properly accounted for in the spreadsheet. It was also noted that the
spreadsheet contains scripted formulas that automatically calculate the amount to invoice
each tow company following the end of each month. Although the reviewed formulas
accurately calculated the amounts owed based on the data entered, they were not locked to
help prevent someone from changing them.
In addition, the tow companies were not billed when the Coin Room staff leaves the
corresponding Excel cells blank because the supporting documentation is missing or
incomplete. The following table provides a breakdown as to the corresponding number of
unbilled tows for each month in the audit period based on the Parking Department's reviewed
monthly Excel spreadsheets:
Month/Year #of Unbilled Tows #of Unbilled Tows #of Unbilled Tows
(Beach Towing) (Tremont Towing) (Total)
October 2017 7 41 48
November 2017 9 28 37
December 2017 20 69 89
January 2018 6 53 59
February 2018 7 29 36
March 2018 11 37 48
April 2018 4 36 40
May 2018 7 31 38
June 2018 4 39 43
July 2018 19 33 52
August 2018 9 39 48
September 2018 10 36 46
October 2018 20 40 60
Total 133 511 644
When questioned, the Parking Department's Senior Management Analyst stated that the
unbilled tows represent instances where the towed vehicles have not been picked up,junked
or auctioned and the proper documentation was not submitted. Yet, Section 3 of the Towing
Permits specifies that the City is to receive a monthly permit fee for each vehicle towed, which
includes those where monies are collected from the customer, as well as those where the
vehicle goes to the scrapyard or auction. Furthermore, the Parking Department had not
followed up on these 644 blank or unbilled entries as of the beginning of this audit, so no
monies would have been billed to the applicable tow company or paid to the City for any of
these tows.
OIG staff reviewed the applicable PES's body camera footage for the 25 unbilled towing slips
that occurred between October 9th and October 22th, 2018, whereby it was verified that all the
sampled unbilled tows occurred. However, it would be difficult and time consuming to try to
determine whether any of these tows represent "no charge" or abandoned or Miami Beach
resident, or all other(nonresidential) tows, and the actual amount to be billed and paid to the
City(either$0, $20, $25 or$30 respectively)for each.
During the 13-month audit period, it was determined that 94.49% of all tows were for
nonresidents, 3.95%were for residents, 0.78%were for abandoned vehicles and 0.78% were
for "no charge" vehicles (excluding the unbilled tows) based on the Excel spreadsheet billed
entries. If this percentage distribution were to be applied to the unbilled towing entries, it
would have resulted in an estimated total amount of$18,992 ($18,256 for nonresident vehicle
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tows + $636 for resident vehicle tows + $100 for abandoned vehicle tows) being owed to the
City. Of this total, Beach Towing would owe$3,922 and Tremont Towing would owe $15,070.
Another option is to assume that all unbilled tows result in the maximum of$30 each owed to
the City unless the applicable tow company's supporting documentation proves otherwise, as
the calculated percentages above are continuously changing. If this option were to be applied
for the data provided during the audit period, the City would be owed in total $19,320, which
would be comprised of$3,990 for Beach Towing and $15,330 for Tremont Towing. This figure
is only$328 different from the previous option($19,320-$18,992= $328)and is much simpler
to calculate.
Other testing performed identified a total of 75 instances in which the Parking Department
incorrectly charged the tow companies twice for the same tow, resulting in a $2,135 total
overbilling during the audit period. More specifically, Beach Towing was overbilled by $1,065
due to 37 duplicate billings and Tremont Towing was overbilled by $1,070 from 38 duplicate
billings.
This duplication occurred because there are two separate columns present on the Excel
spreadsheet to classify whether the tow involves an abandoned vehicle ($20) or one of the
other remaining charges ($25 or$30). As a result, Coin Room staff can mistakenly enter data
in both columns and, as noted above, they did so for 0.31% of the total Parking Department
requested tows ((37 + 38)/23,844).
Lastly, a comparison of the total number of tows Fisted on the Parking Department's Excel
spreadsheet and the Office Associate IV prepared monthly invoices identified the following
monthly differences resulting in an $2,795 underbilling to Beach Towing:
Month/Year Monthly Invoice l Excel Monthly Tows Tows Dollar
Tows Count Spreadsheet Count Difference
Tows Count Difference
October 2017 866 1 870 } (4) ($120)
November 2017 777 789 i (12) ($350)
December 2017 967 ' 988 (21) ($600)
January 2018 894 896 (2) (555)
February 2018 833 836 (3) ($90) i
March 2018 1,210 1,226 (16) ($475)
April 2018 891 902 (11) 1 ($300)
May 2018 883 886 (3) ($90) •
June 2018 852 858 (6) ($150)
July 2018 959 967 (8) ($235)
August 2018 897 901 (4) -- ($120)
September 2018 841 846 (5) ($150)
rOctober 2018 i 852 1 854I (2) ($60)
Total I 11,722 11,819 i (97) [ ($2,795) 1
The same comparison for Tremont Towing identified the following monthly differences
resulting in an $1,925 underbilling:
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Month/Year Monthly , Excel Monthly Tows Dollar
Invoice Spreadsheet Tows Count Difference
Tows I Tows Count Difference
Count
October 2017 841 842 (1) ($30)
F November 2017 766 1771 (5) ($155)
December 2017 926 939 (13) i ($385)
January 2018 { 839 842 (3)_ ($90)
February 2018 803 806 (3) ($90)
March 2018 1,199 1,210 (11) ($265)
April 2018 860 863 (3) i ($90)
May 2018 864 867 i (3) ($90) I
June 2018 831 833 (2) ($55)
July 2018 936 946 (10) ($290)
August2018 867 873 (6) ($175)
September 2018 i 814 819 (5) ($90) '
October 2018 843 847 (4) ($120)
i Total 11,389 1 11,458 (69) i ($1,925)
In total, Beach Towing would owe the City an estimated $5,652 ($3,922 in unbilled tows -
$1,065 in duplicate overbillings + $2,795 resulting from differences in the number of tows
when comparing the Excel spreadsheet with the actual invoices) for Parking Department
requested tows occurring during the audit period. Whereas, Tremont Towing would owe the
City an estimated$15,925($15,070 in unbilled tows-$1,070 in duplicate overbillings +$1,925
resulting from differences in the number of tows when comparing the Excel spreadsheet with
the actual invoices)for Parking Department requested tows occurring during the audit period.
Thus, the total owed to the City by both tow companies is an estimated amount of$21,577.
b. Police Department Requested Tows
The Police Department's VRO is tasked with ensuring that a VSR is received for each towed
vehicle, and that necessary corrections are made and provided to the PSCU message center,
CAD system, and any other system related to towed vehicles, among other responsibilities.
As part of the VRO functions of the PEU, three Impound Vehicle Disposition Reports are
generated monthly to account for all tows performed by each tow company. Impound vehicle
disposition refers to the clearing status of vehicles entered into eAgent by a PSCU dispatcher.
eAgent is law enforcement software that provides access to the Federal Bureau of
Investigation's National Crime Information Center, which is an electronic clearinghouse of
crime data that aids law enforcement agencies in the recovery of stolen property.
Once the dispatcher has completed the search in eAgent and determined the status (e.g.
stolen, not stolen) and ownership of the vehicle, a disposition category is assigned to the
impounded vehicle in the City's CAD system to indicate whether the vehicle is cleared or had
a hold assigned to it at the time of the tow. Shortly after the end of the month, a Property
Evidence Technician (PET) is tasked with the billing of Police Department's requested tows,
and the creating of monthly memorandums stating the total amount of tows to be billed to
each tow tow company, which are later provided to the Finance Department for the
corresponding monthly billing.
To determine the accuracy of the towing companies' billings in accordance with the Towing
Permits, and whether the number of tows billed reflected the number of tows found in LERMS,
OIG staff requested a report of all tow numbers stored in LERMS for the audit period.
Additionally, the monthly memorandums and the corresponding impound vehicle disposition
reports were requested for each month of the audit period.
The PET discussed the steps required to generate an impounded vehicle disposition report
used to calculate the number of tows to be billed. In doing so, it was noted that only three out
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of 11 possible disposition categories are used for the creation of the monthly impound vehicle
disposition report. The PET stated that in a prior training, he was instructed to only select
three specific disposition categories to account for all tows performed. OIG staff requested
documentation to support this statement, but none was provided.
The table shown below reconciles the information from both sources and provides the results
of the comparison. OIG staff calculated that the tow companies were underbilled by a total of
126 tows(74 from Beach Towing + 52 from Tremont Towing = 126)which amounted to$3,245
($2,015 Beach Towing + $1,230 Tremont Towing = $3,245) owed to the City.
Difference Between tERMS Data and Mania Dad
Total Count of Total Sum of Amount Due
I leach Towing Nath Towing Tremont Towing •Tremont Towing TowNumber to the City
Difference in Tow Difference(LERMS- Difference in Tow Difference(LERMS- Tow Count(LERMS- Total Difference(LERMS-
Count(LERMS-Munis)Munis) Count(LERMS-Munis)Munis) Munis) Munis)
2017 21 $ 605.00 5 $ S0.00 26 $ 655.00
Oct 41$ 105.00. 1 5 5.00 l 5 S 110.00
Nov 151$ 445.00 5 $ 135.00 20 $ 580.00
Dec 2 $ 55.00 1 $ (90.00) 1 $ (35.00)
2018 53 $ 1,410.00 47 $ 1,180.00 100 $ 2.59000
Ian f 6 $ 155.00 5 $ 95.00 11 S 250.00
Feb i4 $ 115.00 2 S 30.00 Si$ 145.00 I
Mar 0i 5 (25.DD)i 2 $ 45.00 2 $ 20.00 i
Apr 1 1 $ 35.00' 31$ 85.00! 4 $ 120.00
May I $ 25.00 5 $ 155.00 6 $ 180.00
Juni 10 $ 255.00 11 $ 295.00 21 $ 550.00
i Jul 11 $ 315.00 3 $ 60.00 14 $ 375.00
Aug S $ 145.00 9 $ 235.00 14 $ 380.00
Sep 3 $ 95.00 2 $ 45.00 5 $ 140.001
Oct 12 $ 295.00 5 $ 135.00 17 $ 430.00
Grand Total 74 $ 2,015.00 52 $ 1,230.00 126 $ 3,245.00I
OIG staff determined that the permit fees per tow were not billed in accordance with Sections
3 and 21 of the Towing Permits. The Police Department did not track instances in which the
City is to receive less than the$30 maximum per towed vehicle(City vehicles=$0, abandoned
vehicles = $20 and Miami Beach residents' vehicles = $25) during the audit period. Instead
they continually assumed that all vehicles in their monthly reports forwarded to the Finance
Department are to be billed at the $30 rate each except for one or at most two $25 resident
tows during the audit period.
Due to concerns about the completeness of the number of tows billed, impound vehicle
disposition reports for all 11 categories were requested and a reconciliation of the number of
tows stored in LERMS with the number of tows billed to both companies was performed for
the audit period. The reconciliation included tows billed at either$30 for non-residents or$20
for abandoned vehicles; however, there was no means to determine the number of resident
tows (billed at $25 each), since they are not documented by the Police Department's VRO. If
the percentage of residential tows for Police Department requested tows was the same as for
Parking Department requested tows during the audit period (3.95%), it was estimated that the
tow companies may have been overbilled by the Police Department at $160 for Tremont
Towing and $150 for Beach Towing for the 13-month period tested.
It was noted that the billing discrepancies occurred due to the source of data used to compose
the monthly billing memorandums, as they were not capturing all the different types of tows.
The impound vehicle disposition reports used for the monthly billings provided limited tow
counts contributing to the underbilled amounts mentioned above. Additionally, the absence of
an analysis of the tow receipts to determine whether police tows are for residents, non-
resident, or abandoned contributed further to the billing discrepancies.
Lastly, police officers' reports filed by the PSCU are assigned a police case number along
with an impound number in the City's CAD System for any corresponding tows requested.
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However, police officers complete VSRs for tows by annotating the police case number and
not the impound number associated with the tow. During our review, VSRs requested from
the PSCU were provided when located; however, the PSCU advised that since all tow cases
are filed by police case number, a physical search of police case files in the Records Division
is required to view copies of VSRs and their corresponding tow receipts.
Recommendations:
The Parking Department Director should require as follows:
a. The Office Associate IV should invoice Beach Towing $5,652 and Tremont Towing
$15,925 for the identified net underbilling during the audit period, and perform a similar
analysis of all billed amounts after October 31, 2018, to determine their accuracy;
b. Designated staff should perform timely follow-up reviews to ensure that all blank or
unbilled entries are accurately recorded in the Excel spreadsheet so that the proper
amounts are billed to each tow company. If any blank or unbilled entries exist at the end
of the month and have not been timely explained by the applicable tow company, then the
Coin Room staff should assume that the transaction represents a $30 nonresidential tow;
c. The Senior Management Analyst in charge of the invoicing process should:
• lock the underlying Excel formulas so that they cannot be changed, and should also
combine reporting whether the tow involves an abandoned, Miami Beach resident or
non-resident vehicle into one column to help avoid the possibility of duplicates and
overbillings;
• verify that all sequential tow numbers are present each month and periodically review
the spreadsheet's accuracy to ensure that the tow companies are accurately invoiced;
• add a column in the Excel spreadsheet to record the time that the customer retrieved
the vehicle to facilitate the City's review of storage and after-hours fees;
• reconcile the number of tows billed each month to the Excel spreadsheet to confirm
that the correct amounts are billed.
The Police Chief should require that designated staff:
a. Determine the optimal method to accurately calculate each month how many tows are to
be billed: $30, $25, $20 or $0. Options to consider include maintaining an Excel
spreadsheet similar to the one prepared by the Parking Department, highlighting
abandoned and residential tows on the LERMS data report and attaching the system
supporting documentation.
b. List the vehicle impound number on the VSR to facilitate identification going forward and
to expedite the reconciliation and billing process.
Lastly, the Chief Financial Officer should instruct Finance Department personnel to invoice
Beach Towing $1,865($2,015-$150)and Tremont Towing $1,170($1,230-$160)for unbilled
permit fees owed to the City for Police Department requested tows performed between
October 1, 2017 and October 31, 2018.
Parking Department's Response:
in December 2018, Parking Administration began an internal review of monthly tow invoice
discrepancies dating back to October 2016. As a result of this review, 252 tows performed by
Beach Towing were identified as unbilled resulting in a balance due of$7,835 owed to the
City. Additionally, 722 tows performed by Tremont Towing were identified as unbilled resulting
in a balance due of$21,780 owed to the City. In April 2019, Beach Towing was invoiced for
their respective true-up balance due with INV# 19738, payment towards this invoice and
posted on May 16, 2019. in May 2019, Tremont Towing was invoiced for their respective true-
up balance due with INV#20280 and payment towards this invoice posted on June 13, 2019.
Finally, in March 2019 Parking Administration implemented quarterly towing true-up reviews
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designed to reconcile delayed or undocumented towing records with the appropriate invoice
classification outlined in the tow permit and to escalate missing supporting documentation to
management.
As of February 2020, the cells and formulas included in the monthly tow Invoice excel
workbooks for Tremont and Beach Towing are secured and password protected.
Parking Department's Implementation Date:
All action items related to these findings have been implemented
Police Department's Response:
Entering a vehicle impound number on Police VSRs would not have any impact on
reconciliation or billing and would only add an additional burden to officers in the field with no
appreciable efficiency gained. All documentation for police cases are filed by case number. In
no way does the Police Department want to start a parallel system organized by vehicle
impound number. All Police VSRs are filed by police case number in the case file and available
through the Records Management Unit. With regards to the billable amounts, this would
require personnel to be present at the tow companies to confirm residency at the time of
release.
Police Department's Implementation Date:
None
Finance Department's Response:
Beach Towing and Tremont Towing were invoiced $2,015 and $1,230 respectively on
2/28/2019.
Finance Department's Implementation Date:
This was completed on 2/28/2019.
Finding #2: Police Department Tow invoices were Prepared After the Designated Billing
Dates and Contained Incorrect Due Dates
Section 3 of the Towing Permits states 'The City shall bill Permittee (Beach Towing and
Tremont Towing), by the 10th of each month, for all tows occurring in the previous month.
A late charge of$50.00, plus the greater of(i)eighteen percent(18%) interest per annum,
or ii) the maximum rate allowable under Florida law, shall be assessed on all payments
received after the 20th day of the billing month."
Both Beach Towing and Tremont Towing are to receive two separate invoices each month from
the City, one for Parking Department requested tows and one for Police Department requested
tows. As a result, each tow company is to receive a total of 26 invoices from the City during the
13-month audit period. An Office Associate IV in the Parking Department prepared their monthly
invoices while a Financial Analyst I in the Finance Department created the Police Department's
requested invoices based on the information received.
Testing found that both towing companies' Parking Department monthly invoices were prepared
on the same day during the audit period. Similarly, the Financial Analyst I prepared the Police
Department's monthly invoices on the same day. A review of the City's enterprise resource
planning system (Munis) determined that fourteen of the 52 monthly billings (26 annual invoices
x 2 towing companies) or 26.92% were prepared after Section 3's stated deadline of the 10th of
each month.
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More specifically, the Financial Analyst I prepared twelve of the 26 Police Department requested
towing invoices or 46.15% after the due date ranging from a low of two days late for December
2017 to a high of 33 days late for November 2017. Testing could not determine the underlying
reasons for their late preparation and whether the delays could be attributed to the Police
Department, the Finance Department or both.
Meanwhile, the Parking Department's Office Associate IV created both towing companies'
invoices timely during the audit period except that invoices for November 2017 were prepared
one day late. When notified, the Parking Department provided documentation showing that the
Munis System was going through the fiscal year-end closing process; therefore, an actual invoice
could not be processed until December 11. Consequently, the Office Associate IV contacted the
tow companies via email explaining that the invoice would not be created until December 11, and
they were provided with the amounts due for the month of November 2017. Given the
circumstances, OIG staff concluded that the Parking Department properly handled this
unforeseen delay, and therefore all tested 26 tow invoices were deemed to have been timely
created.
As stated in Section 3 of the Towing Permits, the corresponding payments are due by the 20`h
day of the same month or a $50 late charge plus interest shall be assessed at the specified rates.
However, the reviewed Police Department towing invoices incorrectly listed a due date of 30 days
from the billing date instead of the designated 20th day of the month for the invoices created by
the Financial Analyst I.
Consequently, OIG staff opted to use the 20' day of the month as the benchmark for all Parking
Department requested tows and to accept the incorrect due date of thirty(30)days from the billing
date as the due date for Police Department requested tows. In doing so, it was found that 25 of
the 26 Parking Department invoiced payments (96.15%) were received timely from the towing
companies. Only Tremont Towing's April 2018 payment was received two days after the stated
May 20, 2018 due date for which the Parking Department's Office Associate IV properly billed
$75.05 in interest, which was paid in full.
Meanwhile, four of the tested 26 monthly Police Department requested tow invoices were paid
after the stated due date. Tremont Towing's November 2017, December 2017, March 2018 and
October 2018 payments were all received late ranging from a low of one day to a high of 26 days.
Immediately upon being discovered by OIG staff, Tremont Towing was notified via email on
January 8, 2019 that the October 2018 payment had not yet been remitted. Once notified, they
sent their payment in full via wire transfer on the same day, preventing it from being even more
delinquent than the 26 days. Lastly, total interest of $235.92 was not billed to Tremont Towing
for the four late Police Department payments.
Recommendations:
a. The Police Chief should inform designated staff to timely calculate the amount to invoice each
tow company and to forward this information to the applicable Financial Analyst I by the 7th
day of each month.
b. The Chief Financial Officer should instruct the Financial Analyst I to timely prepare all Police
Department requested towing invoices by the 10th day of each month.
c. The Chief Financial Officer should instruct the Financial Analyst I that Police Department
invoices should specify that the due date for the corresponding payment is the 201h day of the
same month that it was billed.
d. The Chief Financial Officer should instruct staff to monitor when the tow companies' monthly
payments are received to determine their timeliness, if remitted after the due date, the
corresponding late charge invoice of $50 plus 18% interest should be promptly prepared.
Police Department's Response:
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The Police Department does not bill or receive payments from the Tow Operators. The Police
Department provides the Finance Department monthly towing data in a timely manner and they
prepare and transmit bills and receive payments. The Police Department does not have staffing,
training, or desire to be involved in billing or assessment of late fees and penalties to the Tow
Operators. Our involvement in billing should remain limited to providing monthly data to the
Finance Department.
Police Department's Implementation Date:
None
Finance Department's Response:
The following are responses to Findings 2b; 2c, and 2d:
Finding 2b:
As a result of a change in procedures, all billings are invoiced prior to the 10th of each month.
Finding 2c:
All invoices identify the correct payment terms effective March 2019.
Finding 2d:
Quarterly, the Finance team will review the towing companies'payment history and will issue late
fee invoices as applicable.
Finance Department's Implementation Date:
All have been implemented.
Finding #3: Towing Permits Wording Revisions and Enhancements Needed
City Commissions have approved Towing Permits exclusively with Beach Towing and Tremont
Towing since at least their selection in response to City issued Request for Proposals No. 1-91/94
in 1991. In the years since, the Towing Permits have been revised as needed and new negotiated
terms memorialized. Most likely because of these revisions and a lack of oversight, OIG staff
noticed several sections that contained contradictory language and/or situations where current
practices differed from the current Towing Permits, creating questions as to which was correct.
Consequently, several meetings were held with the City Attorney's Office and Parking Department
management to discuss these issues whereby a consensus was reached. An overview of these
items plus other terms in which OIG staff recommends be clarified are listed below as their
resolution could have a significant impact on the amounts charged to tow customers:
a. Section 22(B) of the Towing Permits states as follows:
Tow Rate Class "A" Tow Truck and Class "A" Car Carrier, including
1. First 30 minutes at the scene $140.00
2. Unlocking door
3. Dropping/hooking up linkage
4. Wheel lift equipment
5. Use of dolly
Conversely, Section22(H)(4) simply states "Dollies or Flatbed Services: $40.00" under
"Special and additional charges". At OIG's request, the City Attorney's Office reviewed this
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contradictory language concerning whether the usage of dollies is included in the $140 Class
A hook-up fee or they are to be added as a separate $40 additional charge per Section
22(H)(4). In summary, the City Attorney's Office concluded that it was an inadvertent
scriveners' error, so it was being properly charged as a separate line item by the tow
companies during the audit period.
b. Section 22(H)(3)of the Towing Permits states, "Administrative fee: $35.00 maximum per tow".
However, it is not defined or addressed in any other sections of the Towing Permits, so OIG
staff was unsure as to when it is to be charged to customers and how it differs from the $30
administrative charge. In actuality, testing found that Beach Towing and Tremont Towing
charged this$35 administrative fee to 98.53%and 99.73% respectively to their tow customers.
When questioned, the tow companies' representative in a January 23, 2019 email said that
the administrative fee is assessed in connection with the administration of the towing program
and compliance with the rules and regulations of the Towing Permits.
c. Section 22(H)(6)of the Towing Permits states "An After-Hours Fee may be assessed for tows
retrieved between the hours of 8:00 PM and 8:00 AM. $30.00". When reading this section,
the wording appeared straightforward, meaning that the $30 fee would be applicable
whenever the vehicle is retrieved by its owner any day between the hours of 8:00 PM and
8:00 AM. However, testing determined that both tow companies were charging this after-
hours fee when vehicles are towed not only between 8:00 PM and 8:00 AM, but also from
8:00 PM Friday through 8:00 AM Monday (all weekend).
Testing confirmed that these after-hours fees were consistently charged to customers based
on this practice. Both Beach Towing and Tremont Towing included these fees on the Towing
Bill of Rights disbursed to their customers and on the signage prominently displayed at their
offices. As a result of charging the after-hours fee consistently throughout the weekend, the
frequency in which the $30 fee is charged to their tow customers significantly increased.
When questioned, Parking Department management said that they were aware that the after-
hours fee was being charged all weekend. They continued to state that the Towing Permit's
intent was to charge the after-hours fees for all vehicles retrieved by customers outside of
normal business hours, which is from 8:00 PM till 8:00 AM Monday through Friday. OIG staff
requested written documentation to determine the accuracy of these statements since they
appeared to differ from Section 22(H)(6)'s stated terms.
In response, the City Attorney's Office provided Resolution No. 2006-26100 which approved
the Towing Permits with Beach Towing and Tremont Towing for the three-year period
commencing on March 1, 2006 with a two-year option term at the sole discretion of the City.
The attached January 11, 2006 Commission Memorandum stated the following "After Hrs
Fee*$30 (imposed Monday thru Friday from 8:00 p.m. to 8:00 a.m. and on weekends starting
at 8:00 p.m. on Friday thru 8:00 a.m. on Monday".
No other documentation could be found in the months that have transpired since to explain
the more stringent wording in the current Towing Permits. The City Attorney's Office
concurred that it would be logical to continue to apply this after-hours fee to all tows occurring
between Friday 8:00pm and Monday 8:00am under the current Towing Permits.
d. The Towing Bill of Rights disbursed to impounded vehicle owners and, on the signage,
prominently displayed at their offices states that the "Towing companies must provide at least
two options for payment: cash, money orders, travelers' checks or personal checks." This
statement contradicts Section 23 of the Towing Permits which states, "Permittee shall accept
the following as acceptable forms of payment: cash, travelers' checks, personal bank checks
drawn on a bank in Miami-Dade, Broward, or Monroe Counties, or credit cards."
Page 15 of 23
Page 10110 of 1430
Although the tow companies are compliant with the above section by not accepting debit
and/or credit cards, a comprehensive report made by the Federal Reserve Bank of San
Francisco' revealed that cash payments are third in line of preference, after debit and credit
cards respectively, and that the preference for cash has decreased over the recent years.
Moreover, the study illustrates that using cash as a payment instrument decreases
significantly based on the purchase amount, from a 49% usage in transactions under $10 to
barely 6% for transactions over $100. Furthermore, three of the 15 complaints (20%)
examined during the audit period included grievances claiming that the tow companies
accepted only cash payments.
The City contracted with Walker Consultants who issued a report that was last revised on
December 10, 2018 regarding the maximum allowable towing rates. Excluding Miami Beach,
this report showed that seven (7)of the nine(9)studied cities and counties (77.78%) accepted
either debit and/or credit cards. The seven (7) included Broward County, the City of Key West,
the City of Miami, Monroe County, Pinellas County, Palm Beach County and Tampa.
Conversely, the two cities that did not accept either debit and/or credit cards were Daytona
Beach and Panama City Beach.
e. Section 22(B) through (E) of the Towing Permits details the hook-up fees to be charged
ranging from $140 for Class "A" tows to $200 for Class "D" tows. The hook-up fee is a
standard charge that is typically levied against all towed vehicles. In summary, the Towing
Permits require the applicable tow company to bill hook-up fees based or the class of the
wrecker/tow trucks and/or car carrier as defined in Section 11 of the Towing Permits.
A. Class "A" wreckers and slide back car carriers - commercially manufactured unit, with a
rated capacity of not less than 10,000 pounds, GVW (gross vehicle weight)
B. Class "B" wreckers - commercially manufactured units, with a rated capacity of not less
than 18,000 pounds, GVW
Class "B" slide back car carriers — commercially manufactured unit, with a rated capacity
of not less than 20,000 pounds, GVW
C. Class "C" wreckers — commercially manufactured unit, with a rated capacity of not less
than 36,000 pounds, GVW
The Towing Permits do not similarly define a Class "D" wrecker in the Towing Permits so it was
assumed that it would contain a rated capacity of equal to or more than 36,000 pounds (the
maximum weight limit for Class "C" wreckers).
Furthermore, the Towing Permits state that hook-up fees are to be charged based on the capacity
of the wrecker, regardless of the size of the vehicle. A legal opinion from the City Attorney's Office
was requested to confirm this interpretation, and the following response was received:
"The maximum allowable rate to be charged by Beach Towing Services, Inc. or Tremont Towing,
Inc. (collectively, the "Towing Permittees") for any vehicle tow must be based upon, and solely
depend on, the Gross Vehicle Weight ("GVW") of the actual vehicle being towed, irrespective of
the classification of the wrecker("A", "B", "C" or"D")which is utilized for the towing of said vehicle
by the respective Towing Permittees.
In other words, pursuant to the Towing Permits, there is no prohibition on the Towing Permittees
employing a wrecker with a rating capacity greater than necessary to accomplish the tow of a
particular vehicle. However, should the Towing Permittees utilize a wrecker with a rating capacity
https://www.frbsf.ogcashipublicationsifed-notes/2019/june/2019-findings-from-the-diary-of-consumer-payment-
cho ce/
Page 16 of 23
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greater than necessary to effectuate the tow of a particular vehicle (when a wrecker of a lesser
rating capacity could safely carry out such tow), then the affected customer should only be
charged based upon the rates set forth in the Towing Permits for the lowest rated (least
expensive) wrecker class that could have been utilized to accomplish the tow based upon the
towed vehicle's GVW."
Recommendations:
The City Administration and City Commission should consider that the next Towing Permits:
• Be thoroughly reviewed to avoid any contradictory or confusing terms such as those
mentioned above and to thoroughly define all terms and charges so that all parties can clearly
determine whether they were charged correctly and/or were properly compensated.
• Require both tow companies to accept debit and/or credit cards as a form of payment. Also,
the Towing Permits and the Towing Bill of Rights need more clarity and should be in
agreement.
• Include financial penalties that either the City and/or the vehicle owner could levy against the
tow companies in the event of verified overbillings.
Parking Department's Response:
The Administration will conduct a comprehensive review of all towing permit provisions and
address any inconsistencies. Additionally, the Administration will develop and incorporate
performance standards and related penalties in order to strengthen compliance of permit
requirements.
Parking Department's Implementation Date:
The Administration will address any inconsistencies in the towing permits upon the completion of
internal and external audits.
Police Department's Response:
The Police Department takes no position on the towing rates for the particular classes of vehicles.
The burden should be on the Tow Operators to document their services correctly and penalties
should be imposed if irregularities are found during audits.
Police Department's Implementation Date:
None
Finding #4: Formal Complaint Logs are not Maintained
Section 29 of the Towing Permits states "Any complaints received by the City concerning a
violation by Permittee of Article V, Division 2, Sections 106-211 through 106-255 of the City Code,
or these Administrative Rules and Regulations (including, without limitation, misconduct,
excessive charges, poor business practices, damage to vehicles, etc.) shall be referred to the
City's Chief of Police or to the City's Parking Director for investigation (depending on which City
department originated the tow). The respective department shall use reasonable efforts to notify
Permittee (whether verbally or in writing) of any such complaints (including the specific nature
thereof) within five (5) business days from receipt of the complaint. The Permittee shall provide
written explanation and information with respect to the particular complaint, within five (5)
business days from notice by the City. Permittee's response shall include identification of any
proposed resolutions(s) and corrective measure(s) to be taken.
A written disposition of the complaint will be forwarded to the Permittee (and complainant) upon
completion of the City's investigation. The City Manager reserves the right, in his sole discretion,
to require Permittee to refund all or any portion of the towing fees to a complainant, as liquidated
Page 17 of 23
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damages, should the City rule in favor of the complainant.
If there have been three (3) or more substantiated complaints filed with the City within a ninety
(90) day period during the Permit term, the City Manager may suspend the Permit for a period of
up to thirty(30) days, with no reduction in the Permit fee."
When questioned, the City's Parking and Police Department staff both stated that they do not
keep formal logs, but they assured OIG staff that they respond to and investigate all received
complaints. In response, the Parking Department provided emails for nine public and private tow
complaints received during the audit period. In reviewing these emails, it became evident that
the information was incomplete. For example, the email chain provided did not always include
the initial email containing the customer's original complaint, the reader cannot tell which
represent public or private tows, four of the seven pertinent Miami-Dade County complaints
referenced below were not present, etc.
Therefore, OIG staff could only perform test on the nine emails provided to determine if they were
compliant with Section 29 of the Towing Permits. As a result, the Parking Department investigated
five of the complaints, and it was concluded that they either had no merit or they were satisfactorily
resolved between the two parties. More specifically, substantiated complaints on two public tows
concerning Beach Towing were filed with the Parking Department on August 16, 2018 and
September 21, 2018. Another substantiated Beach Towing complaint was received on November
1, 2018 by the Parking Department but based on the emails provided it cannot be determined
whether it was a public tow or a private tow. If it was a public tow, then the City Manager was to
have been notified to decide whether to suspend Beach Towing's permit in accordance with
Section 20 of the Towing Permit. If it was a private tow, then no further action would be necessary.
Nothing to date has been provided concerning the resolution of the remaining four received
complaints from the Parking Department.
OIG staff also contacted Miami-Dade County to determine the number of complaints that they
have received and their corresponding resolution. They provided documentation showing that
they had received nine complaints between May 1, 2018 and October 31, 2018. Of these
complaints, two were closed by Miami-Dade County and the remaining seven were referred to
the City's Parking Department for resolution as the County does not have applicable jurisdiction
in Miami Beach.
Three of the remaining Miami-Dade County complaints were included in the nine previously
received from the City's Parking Department. One of these complaints, created on August 20,
2018 (issue #2018-7186), was found to have merit, as the customer attached camera footage
from neighboring businesses confirming that a dolly or flatbed service was not used proving that
they were wrongfully charged. This tow customer's persistence provided the basis for the Miami
New Times Article dated August 23, 2018, entitled "Miami Beach Cracks Down on Bogus Flatbed
Fees From Towing Companies". Finally, documentation was provided showing that the last four
complaints referred to the City's Parking Department by Miami-Dade County were investigated
and were properly responded to.
Recommendations:
a. The Parking Department Director and the Police Chief should require that their designated
staff maintain a formalized log that records all received complaints and documents whether
timely resolution occurred in compliance with Section 29 of the Towing Permits.
b. A City designated helpline and/or email address should be established to centralize and
document all customer complaints to help ensure that they are timely investigated and
resolved with the tow companies.
c. The City Administration should revise the Towing Permits to specify a fixed, agreed upon
Page 18 of 23
Page 1013 of 1430
amount that is to be paid directly to the City by the applicable tow company to help offset City
staffs wages for time spent in researching valid complaints as determined solely by the City.
Parking Department's Response:
The Parking Department will develop a Towing Log of Complaints (TLC) for tracking purposes,
including a helpline. The incorporation of performance standards and related penalties shall serve
to offset staff time expense related to researching valid complaints.
Parking Department's Implementation Date:
The Administration will incorporate these recommendations as a component of the towing
permits. implementation will be upon approval of the towing permits by the City Commission.
Police Department's Response:
Although, the Police Department does not investigate civil matters, complaints/calls for service
are available via the CAD system and include a disposition. We respond to and investigate
criminal matters, including all allegations of criminal conduct involving the Tow Operators. There
is no designated staff able to receive, log, track, make notifications, or investigate civil matters
related to tow disputes. Police already respond to dozens of calls each month related to towing
and placing an additional administrative burden on patrol officers or other police staff to track and
follow up with complaints and dispositions for what amount to civil or permitting matters would be
unduly onerous.
Police Department's Implementation Date:
•
None
Finding #5: Lack of Information to Determine Tow Response Times
Section 14 of the Towing Permits states "Permittee shall respond to requests for tows within
twenty (20) minutes of receipt of the request. In the event that Permittee cannot respond within
twenty(20) minutes, it shall notify the requesting City party of the estimated time of delay and the
reasons thereof, and the City shall have the option, at its sole discretion, to cancel the request
and contact another Permittee, without cost and/or other liability to the Permittee to which the
initial request for tow was directed."
Testing found that the requested tow truck operator's arrival time is reported to the Parking
Department's Dispatcher and is tracked in LERMS. In addition, OIG staff reviewed Parking
Department Enforcement Officers' body camera footage of sampled tows from October 9 through
October 22, 2018, whereby it was confirmed that all appeared to arrive within twenty (20) minutes
in accordance with Section 14.
A review of the Police Department's maintained documentation found that the tow truck operator's
arrival time is not reported. Although police officers' body camera footage was similarly reviewed,
it was more difficult to determine the tow trucks arrival time as the officers were more occupied
with handling the situation (interviewing the individuals to determine how and why the traffic
accident occurred, completing the required paperwork, arresting individuals when needed, among
others). Where the footage allowed, it was determined that sampled Police Department tows
satisfied the twenty-minute goal.
Inquiries with Parking and Police Department staff found that they are not aware of any instances
whereby the other tow company was contacted because the initial one did not arrive timely. In
addition, it may result in a longer overall waiting period because the initial contacted company is
most likely in transit and the newly contacted company must assign a tow truck operator which
could take upwards of twenty minutes depending on availability.
Page 19 of 23
Page 1014 of 1430
Recommendations:
No further action is necessary except that it is recommended that the tow truck operator's arrival
time should be recorded on the VSR to help track compliance with the twenty-minute goal. If a
trend forms and persists whereby one company is repeatedly not arriving timely, then it should be
addressed with their management. Otherwise, the twenty-minute goal should not necessarily be
strictly enforced as the objective is not to potentially have tow truck operators speeding and/or
driving recklessly through the City's streets as they try to satisfy Section 14's terms.
Finding #6: Lack of Information on Tow Companies not Alternating
Based on inquiries with Parking Department management, Dispatchers are to manually alternate
towing requests between the two companies as the process is not automated. If alternating
companies are not followed at any given time, compensatory measures are to be taken to help
ensure that an equal share of overall towing requests exists. For example, if Beach Towing
inadvertently received two towing requests in a row, then Tremont Towing is to receive two in a
row once the oversight is identified.
Testing was performed to determine the number of tow requests alternating between the two
companies for Parking Department requested tows. A total of 23,844 Parking Department
requested tows (includes unbilled tows) recorded through the LERMS system were analyzed for
the 13 months between October 1, 2017 and October 31, 2018. The corresponding results are
presented below:
Results _ _ Count Percentage
Alternating: _ 23,474 98.45°,
Not Alternating: 369 1.55%
Last in List(not able to be compared/Tremont) ! 1 0.0%
Total: 23,844 100.0%
Results for "Not Alternating"
Not Alternating - to the benefit of Tremont Towing: 169 0.71%
Not Alternating - to the benefit of Beach Towing: 200 I 0.84%
Total for Tremont: 11,907 I 49.94%
, Total for Beach: ; 11,937 i 50.06% '
Although no alternation occurred in 1.55% of the requested public tows, the subsequent
breakdown showed that this difference was typically corrected. In summary, Beach Towing
performed on a net basis, 15 more public tows than Tremont Towing (11,937 — 11,907 = 30/2 =
15) during the 13-month audit period ((23,474/2) + 200 — 15 = 11,922 x 2 companies = 23,844
total). This immaterial 0.0629% difference (15/23,844) was not investigated further as in some
months one company had more tows and, in some months, the other company had more. Exhibit
2 below provides a graphical depiction of the percentage share of towing services assigned to
each company per month.
However, the Parking Department does not maintain any documentation indicating why one tow
company was bypassed and why the other company received more tows. As the Dispatchers are
to manually alternate towing requests between the two towing companies, there remains the
possibility that more significant differences could exist either in previous periods not reviewed or
in the future.
Recommendations:
The Parking Department Director should instruct its Dispatchers to document the reasons why
one tow company received sequential tow requests over the other company. The Excel
Page 20 of 23
Page 1015 of 1430
spreadsheet prepared at month's end should indicate a maximum difference of one unless the
underlying reasons are documented. If not, the current Dispatcher(s) should be notified so that
the difference could be subsequently corrected to help avoid any potential disagreements.
Parking Department's Response:
The Parking Department Director will instruct Parking Dispatchers to document, on CADD, the
reasons why one tow company received sequential tow requests over the other company.
Parking Department's Implementation Date:
This feature will be implemented on July 6, 2020.
Finding #7: Lack of Oversight Concerning Insurance Coverage
Section 4 of the Towing Permits specifies the required insurance coverage that is to be in full
force and effect at all times throughout the term. A copy of Beach Towing and Tremont Towing's
current insurance policies were requested and promptly received from the City's Parking
Department. As it had not been previously reviewed by the City's Risk Management Division for
sufficiency, OIG staff met with their staff on January 31, 2019 and the following deficiencies were
identified:
a. Neither tow company provided evidence that either workers' compensation coverage was
maintained or had submitted a document stating that they have four or fewer employees and
are not required to maintain this coverage.
b. The City is not named as an additional insured in the 'Description of Operations/
LocationsNehicles" section by either tow company.
c. The certificate holder for Tremont Towing should be the City of Miami Beach and not a specific
City department.
Per City Resolution No. 2018-30244, the City contracted with Exigis, LLC to provide a certificate
of insurance tracking system for contractors, firms or individuals doing business with the City to
help ensure that they carry and maintain the appropriate levels of insurance. Neither towing
companies' insurance coverage terms were provided to the Human Resources Department's Risk
Management Division for uploading into the Exigis, LLC system to facilitate identifying any
deficiencies.
Recommendations:
a. Going forward, Section 4's terms and both tow companies' insurance policies should be
uploaded into the Exigis, LLC System to help ensure that they are compliant.
b. The Parking Department Director and/or Police Chief should instruct their designated staff to
periodically verify that Beach Towing and Tremont Towing maintain the required insurance
coverage in accordance with the Towing Permits.
Parking Department's Response:
The Parking Department Director has coordinated the inclusion of the both towing permits in the
Exigis, LLC System with the Procurement Department Director.
Parking Department's Implementation Date
The inclusion of both towing permits on the Exigis, LLC System has been completed.
Police Department's Response:
The Permit says that this needs to be filed with the City's Risk Manager.
Police Department's Implementation Date:
Page 21 of 23
Page 1016 of 1430
None
Finding #8: Several Noted Miscellaneous Parking Department Deficiencies
The following miscellaneous shortcomings pertaining to the Parking Department were noted
during testing:
a. Standard Operating Procedures are beneficial as they serve as a benchmark to measure
individuals' performance and as an instruction manual in the event employees are out of the
office for whatever reason. The provided Parking Department's Standard Operating
Procedures concerning towing are incomplete and too simplistic as they do not adequately
detail employee's roles involved in the process. The electronic copy furnished was last
revised on November 2014 and was not signed by the Parking Department Director.
b. In the Miami New Times Article dated August 23, 2018 entitled "Miami Beach Cracks Down
on Bogus Flatbed Fees From Towing Companies" article, Parking Department management
stated that they informed both tow companies to only charge dollies or flatbed service fees if
they were used in public view with a City agent present to verify that such equipment was
utilized. However, testing found that the Parking Enforcement Specialists (PESs) present
when the tows occur are not documenting the VSRs when the usage of the dollies and flatbed
services are warranted. As the PESs do not subsequently review Beach Towing's actual
charges to their customers, they would not be aware if any dollies and flatbed services fees
charged are correct.
Recommendations:
The Parking Department Director should ensure that:
a. The Parking Department's Standard Operating Procedures are updated to better depict
current operations and they should be properly approved.
b. The PESs present when vehicles are being towed should record the complete tows with their
body cameras going forward to help resolve any future billing questions or complaints. They
should also document on the VSRs when dollies or flatbed services are being used and when
the tow truck operator enters the vehicle at the tow location. The next Towing Permits should
include language stating that the corresponding tow companies should not invoice the
associated dollies and flatbed services and/or labor to engage/tow fees to their customers
unless the VSRs are noted as such_
Parking Department's Response:
a. The Parking Department Director had all related standard operating procedures updated
and executed, including:
Parking— Quarterly Tow Invoice True-Up— 3/19/20
Parking— Monthly Tow Release Request— 4/1/20
Parking— Monthly Tow Invoice — 5/21/20
b. PESs have been noting on the VSR as well as body camera footage any use of dollies or
flatbed services since September 2018. The customer's invoice for dollies or flatbed
services will be addressed in the revision and update of the towing permit provisions.
Parking Department's Implementation Date:
All miscellaneous deficiencies noted in Finding No. 8 were addressed and completed on the dates
referenced above.
EXIT CONFERENCE
Page 22 of 23
Page 1017 of 1430
As identified deficiencies were forwarded to the auditees during the audit process and an exit
conference was previously held, another meeting was not deemed necessary. Instead, the draft
report was sent via email to the auditees on June 23, 2020 and they were given 30 working days
to provide their management responses in adherence to City Ordinance No. 2019-4239. The
management responses received are included herein.
pproved by:
/moi!tt%! lm. 0 or - D�- D
Ih torino, Inspector General Dat-
Reviewed by:
r
AiL,,L 40 '
I , — oliati 6,z(-).
Mark Coolidge, Chief Audito Date
Completed by:
0 7/ 2-I/ZtC)24°
Norman Blaio , U-• y of Auditor Date
Y�j
cc: Jimmy L. Morales, City Manager
Eric Carpenter, Assistant City Manager
Saul Frances, Parking Director
Richard Clements, Police Chief
John Woodruff, Chief Financial Officer
Michael Smith, Human Resources Department Director
Page 23 of 23
Page 1018 of 1430
Exhibit "B-1"
-Ml g9
4C04-
W.
T O R -
Joseph M. Centorino, •nspector General
TO: Honorable Mayor and Members of the City Commission
FROM: Joseph Centorino, Inspector General
DATE: September 24, 2020
AUDIT: Tremont Towing, Inc. - Towing Audit
OIG No. 20-19
PERIOD: October 1, 2017 to October 31, 2018
This report is the result of a request made by the City Administration in November 2018 for the then-
existing Office of internal Audit to verify compliance of Tremont Towing, Inc. (Tremont Towing) with
selected provisions in the City of Miami Beach Administrative Rules and Regulations For Police and
Parking Towing Permits (Towing Permits) that were in effect during the audit period. An entrance
conference meeting was held in December 2018 with Tremont Towing management to explain the
audit process, to gain an understanding of their operations and to obtain copies of any relevant
documents.
Although the reviewed Towing Permits contain a myriad of points that require compliance from
Tremont Towing, Office of the Inspector General (OIG) staff concentrated its testing primarily on the
accuracy of the City's monthly billings and the amounts charged to tested tow customers. To help
achieve these objectives, we reviewed the provided Standard Operating Procedures, work
performed, available body camera footage, documentation received from the City's Parking, Police
and/or Finance Departments, as well as copies of the Vehicle Storage Receipts received from
Tremont Towing.
As this audit was nearing completion, the City Commission voted in favor of terminating the internal
audit at its June 5, 2019 meeting, and approval was granted for an outside audit of the tow companies.
At that time all internal audit work was immediately suspended. The audit was subsequently re-
visited at the January 15, 2020 Commission meeting wherein it was acknowledged by the
Commission that the newly created Office of Inspector General, as an independent agency, had the
authority to conclude the audit or to take such further action within its authority as it deemed
necessary.
Consequently, the audit was resumed and has resulted in the issuance of three separate audit
reports, including this one. The other two audit reports consist of testing performed relative to Beach
Towing Services, Inc. (Beach Towing) and of the City departments, Parking and Police, involved in
the towing process. Although the work performed was reported separately, there may be some
overlap in the three reports, as noted shortcomings may involve more than one of the parties involved.
ACRONYMS
CAD = Computer Aided Dispatch
GVW = Gross Vehicle Weight (Rating)
LERMS = Law Enforcement Records Management System
VSR = Vehicle Storage Receipts
J^,v Vier, -.i :•'�. ..�'�p, O.,i�,l�.7la .CF.._C, 6.jpJl cc'f"^r
Page 1019 of 1430
INTRODUCTION
Chapter 106, Article V, of the Miami Beach City Code, provides for the issuance of towing permits for
the towing of vehicles identified by the City's Parking and Police Departments as requiring removal
from public and private property, as well as vehicle impoundments. The same two tow companies,
Beach Towing and Tremont Towing, have continued to operate exclusively in Miami Beach since at
least their selection based on their response to Request for Proposals No. 1-91/94. The negotiated
towing permits for the two companies have been revised as needed in the following years.
More recently, City Resolution 2015-28918 was adopted on February 11, 2015 approving the
issuance of new Towing Permits to Beach Towing and to Tremont Towing for a three-year term
commencing on March 1, 2015 and expiring on February 28, 2018. Both companies' terms were
extended for an additional one year through February 28, 2019 with the passage of City Resolution
No. 2018-30161.
Next, the City Commission on December 12, 2019, approved a one-year extension for both tow
companies of the same terms with a reduction of their charged automated teller machine fees.
Although this extension expired in February 2020, Tremont Towing is currently continuing to operate
on a month-to-month basis under its terms.
OVERALL OPINION
Among other tests performed, OIG staff conducted a data analysis of all requested public tows
occurring between October 1, 2017 and October 31, 2018, whereby selected supporting
documentation as well as Parking and Police Department body camera footage for tested days was
reviewed to determine whether the tow fees charged by Tremont Towing were appropriate.
Throughout the audit process, communication was also maintained with the tow company's
representatives to request additional information and/or documentation. However, the received
responses were not always sufficient to clarify the perceived shortcomings. Although the data
obtained from its sample results was not extrapolated to draw conclusions on a larger scale to the
population, the outcomes from the audit process stated in this report suggest that the tow companies
need stronger oversight.
OIG staff believes that the Towing Permits need revision to help improve accountability and to better
ensure that individuals are being properly charged for public tows. Examples include, but are not
limited to, placing more responsibility on the tow companies to justify charges to individuals whose
vehicles are towed, better defining listed terms, clarifying any identified ambiguities, and more clearly
defining the roles of all parties. Without making these and other needed revisions to the Towing
Permits, the deficiencies noted in this audit report will most likely continue and tow customers will
have little recourse.
It is recommended that future Towing Permits include language requiring each tow company to
provide vehicle owners with photographic evidence of the impounded vehicles on dollies/flatbeds
and/or the vehicle's doors needing to be opened by towing company personnel at the tow locations,
to support any corresponding charges. This requirement would permit the consumers of tow services
to determine the validity of the charges at the time they retrieve their vehicles and to question any
discrepancies. Once the owners leave the scene, it becomes less likely that discrepancies will be
noted or refunds retrieved, particularly by out-of-town vehicle owners.
Furthermore, the Parking Department employees present for all Tremont Towing's Parking
Department public tows should function more as consumer and City advocates, since they are
Page 2 of 22
Page 1020 of 1430
present at each tow location and can verify whether dollies or flatbed services were used or whether
the tow truck operators entered the vehicles through entries on the Vehicle Storage Receipts (VSRs).
Any subsequently identified unsubstantiated charges should be promptly refunded to the consumers
and/or financial penalties imposed on the tow companies by the City.
For example, Broward County's Code of Ordinances Section 81/2 - 16(b)titled "Violations of Towing
and Immobilization Regulations" lists several violations (charging more than the allowable maximum
towing and immobilization rate, failure to maintain records for the required period, failing to accept all
mandated methods of payment, among others) whereby the first violation results in a $250 fine per
violation, which increases to $500 for any repeat violations. Meanwhile, City of Miami City Code
Section 42-109 states that a "person who charges a vehicle owner a towing or storage charge in
excess of the rate described herein is liable to the vehicle owner for three times the amount charged."
Conversely, Miami Beach's Towing Permits and City Code remain relatively silent on this issue, and
there are currently minimal consequences for proven non-compliance.
Although several sections of the Towing Permits stipulate the City's right to suspend or terminate the
permit if certain violations are incurred by permittees, enforcing such action could jeopardize tow
service in the City, as only two companies are presently authorized to operate within the City's
boundaries. Therefore, OIG staff believes that the City Commission should consider the possibility
of expanding the tow market to include additional companies that would be required to operate a tow
yard within a designated distance from the City's boundaries. If approved, this expansion would allow
the City to impose a suspension or a termination of the agreement on a company without adversely
affecting the availability of towing services. Alternatively, the City could elect to put the towing service
out to bid to at least force the two current permit holders to compete for the City's towing operation.
Another option would be the in-sourcing of towing operations to be managed by the City or by a
designated entity under greater City control. Despite the potentially high set-up costs with
purchasing/leasing of wreckers/tow trucks, hiring/training staff, and preparing the location,there could
be associated benefits including better control over operations and increased City revenues, as well
as more transparency and oversight capability.
Although it was not provided to OIG staff because the footage was only kept for 30 days before it was
automatically recorded over, Tremont Towing is commended for having selected staff worn body
cameras prior to the beginning of this audit. Conversely, Beach Towing opted not to follow Tremont
Towing's proactive approach and purchase body cameras for their employees. If required in the next
negotiated Towing Permits, this audiovisual evidence could be provided to their tow customers and
the City as corroboration for the charging of dollies or flatbed services, labor to engage/tow fees, etc.
The following shortcomings were noted during testing that require corrective action:
1. 12 of 20 sampled Tremont Towing customers were overcharged for dollies or flatbed services
during the fourteen-day period of October 9, 2018 through October 22, 2018 as such
equipment was not used at the tow locations, based on a review of available Parking
Department body camera footage. Therefore, it was concluded that these 12 customers were
overcharged by a total of$480 ($40 x 12 = $480).
2. Tremont Towing overcharged 16 Class "B", four Class "C" and five Class "D" vehicle owners
hook-up fees of the 42 reviewed (59.52%) based on an analysis of their gross vehicle weight
ratings and other provided documentation.
3. Tremont Towing overcharged its customers labor to engage/tow fees for 12 of the 25 tows
sampled in October 2018 based upon a review of Parking and Police Department body
camera footage. As the tow operators were not observed accessing the vehicles at the tow
location, it was concluded that these 12 customers were overcharged by a total of$360 ($30
x 12 = $360).
4. The times that vehicles were impounded and/or released to their owners were not always
Page 3 of 22
Page 1021 of 1430
indicated on the tow invoices; and one of the 22 tested retrieved vehicles was incorrectly
charged storage fees.
5. The amounts charged and collected by Tremont Towing for state sales taxes on administrative
and/or storage fees for Police Department requested tows does not appear to be necessary
based on a review of the State Statutes and Florida Department of Revenue Law Library
Technical Assistance Advisement(TAA) — 103463 with the City Attorney's Office.
6. Tremont Towing did not maintain the required insurance coverage in accordance with Section
4 of the Towing Permits.
7. Tremont Towing's furnished invoices contained two separate line items that contradicted the
language in the Towing Permits.
SCOPE, OBJECTIVES, AND METHODOLOGY
The scope of this audit was to determine Tremont Towing's compliance with selected terms set forth
in the corresponding Towing Permits. The audit covered the period of October 1, 2017 through
October 31, 2018, and it focused primarily on determining Tremont Towing's compliance with the
following objectives:
• To determine whether vehicle owners were charged in accordance to the rates specified in
the Towing Permits and in conformity with the services received.
• To determine whether the required annual Business Tax Receipt Certificates were obtained.
• To determine whether the required insurance coverage was maintained.
• Other procedures as deemed necessary.
This audit was conducted in accordance with the office's approved Standard Operating Procedures.
Those require that we plan and perform the audit to obtain sufficient evidence to provide a reasonable
basis for our findings and conclusions based on our audit objectives. We believe that the evidence
obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.
The audit methodology included the following:
• Review of applicable provisions within the City Charter and Code of Ordinances, and City
Standard Operating Procedures;
• Interviews and inquiries of City and external companies' personnel in order to gain an
understanding of the internal controls (relative to the operations of the tow services), assess
control risk, and plan audit procedures;
• Performance of substantive testing consistent with the audit objectives, including but not
limited to, examination of applicable transactions and records on a statistical and non-
statistical sample basis;
• Drawing conclusions based on the results of testing with corresponding recommendations,
and obtaining auditee responses and corrective action plans; and,
• Performance of other audit procedures as deemed necessary.
FINDINGS, RECOMMENDATIONS AND MANAGEMENT RESPONSES
The information provided below is relevant for the first four findings, as it represents the criteria for
OIG staff's testing of sampled customer charges. Per Section 22 of the Towing Permits, Tremont
Towing shall not charge more than the following maximum allowable rates established by the City
Permit (as same may be amended from time to time):
A The first eight hours of storage shall be without charge. Thereafter the following storage rates
Page 4 of 22
Page 1022 of 1430
shall apply per day:
1 Inside-Interior
a Motorcycles or Scooters $12
b Any vehicle less than 20 feet in length and eight feet in width $30
c Any vehicle over 20 feet in length $40
2 Outside-Exterior
a Motorcycles or Scooters $10
b Any vehicle fess than 20 feet in length and eight feet in width $30
c Any vehicle over 20 feet in length $30
3 Boat and Trailer(Owner's Unit)
a Unit under 20 feet in length $20
b Unit 21 feet to 35 feet in length $35
c Unit over 35 feet in length $45
B Tow Rate Class "A" Tow Truck and Class "A" Car Carrier $140
C Class "B" Tow Truck $145
D Class "C" Tow Truck $175
E Class "D" Tow Truck $200
F Tow Rate Class "B" or"C" Car Carrier $125
G Use of Contractor's Boat Trailer, any length, including storage, per day:
1 Trailer up to 18 feet in length $50
2 Trailer 18 to 30 feet in length $75
3 Trailer over 30 feet in length $150
H Additional charges:
1 Extra labor or extra waiting time $16.50 per hour after the first 30 minutes at the scene
and prorated after the 1st hour in 15 minutes increments.
2 Mileage Charges $6 per mile, maximum of$42 per tow.
3 Administrative fee $35 maximum per tow.
4 Dollies or Flatbed Services $40
5 Labor to Engage/Tow (this is not an automatic fee and may only be imposed when
access to enter the vehicle is required to properly engage/tow vehicle.) $30
6 After Hour Fee (may be assessed for tows retrieved between the hours of 8:00 PM
and 8:00 AM.) $30
A maximum administrative charge, different from the administrative fees mentioned above in Section
22(H)(3), not exceeding $30 (and not as an automatic "add-on", but only when required to comply
with Florida Statutes) may be imposed by the permittee for services such as the processing of
paperwork, clerical work, or title research. Administrative charges are defined as costs associated
with verification of a vehicle identification number; search of vehicle for ownership information;
preparation of paperwork required by Florida Statutes; preparation and mailing of the notification
letter(s); and preparation of vehicles for auction (including notification to owner or lien holder).
Administrative charges shall not be imposed on vehicles with a "police hold" until or unless the hold
is removed. Storage for City (confiscated) vehicles with "police holds" is free of charge to the City.
These maximum allowable rates mentioned above shall not apply to City of Miami Beach residents
(such exemption(s) for City of Miami Beach residents shall hereinafter be referred to as the "Miami
Beach resident discount"). To be eligible for this resident discount, individuals must provide proof of
residency within the City of Miami Beach, and their driver's license information must match the
registration information of the vehicle being towed. The permittee shall maintain a log documenting
discounts given to City residents pursuant to the Miami Beach resident discount, which log shall be
available for inspection and copying by the City Manager or his designee, upon request. The
permittee shall prominently post a sign displaying the maximum allowable rates for both City and non-
City residents within the area(s) on its premises designated for the vehicle owner or his agent to
transact business.
Page 5 of 22
Page 1023 of 1430
Parking Department vs. Police Department Requested Tows
In total, the Law Enforcement Records Management System (LERMS) showed that there were
23,844 (90.96%) Parking Department requested tows and 2,371 (9.04%) Police Department
requested tows during the 13-month audit period. The Parking Department has established a process
whereby their Coin Room staff manually enter into monthly Excel spreadsheets a detailed breakdown
of all the individual amounts charged to each towed vehicle owner by the tow company, which
includes, among others, storage fees, mileage charges, administrative fees, after-hours fees, labor
to engage/tow vehicle fees, and state sales taxes.
Conversely, the Police Department has not established a similar process for documenting the
individual amounts charged to each towed vehicle owner. Police Department's designated
employees enter limited information from the VSR that are received from the tow companies into the
Computer Aided Dispatch (CAD) System for the release of the vehicles before they are forwarded to
the Records Section for filing. Shortly after the month's end, a CAD System report is generated of all
recorded Police Department requested tows which is forwarded to the City's Finance Department for
billing.
The detailed monthly Excel spreadsheets enabled OIG staff to perform a wide range of analyses on
the Parking Department's requested public tows. Similar information is not readily available for the
Police Department's requested tows, which only comprised 9.04% of the total tows. Therefore, their
tows were typically excluded from further analysis, but there is no basis upon which to believe that
analysis of those tows would differ from those of the Parking Department.
As the information in these Excel spreadsheets was entered through a manual data entry process, a
quality control test was performed to assess their reliability. All 350 tows performed by both tow
companies in a randomly selected 7-day period occurring between October 9, 2018 and October 15,
2018 were reviewed. The corresponding data present in 2,450 entry fields (7 fields x 350 tows) in
the spreadsheets was compared to the applicable storage receipts and/or invoices so that any
identified inaccuracies could be quantified. When completed, it was determined that only 16 of the
entries contained errors or 0.65%(16/2,450), which means that the accuracy rate was 99.35% ((2,450
— 16)/2,450). Based on these results, OIG staff relied on the monthly spreadsheets data in performing
various analyses for the audit period.
Alternating Tows
Parking Department management stated that Dispatchers are to manually alternate tow requests
between the two companies. If that practice is not followed at any given time, compensatory
measures are to be taken to ensure that an equal share of overall tow requests is maintained. For
example, if Tremont Towing inadvertently receives two consecutive tow requests, then Beach Towing
is to receive two successive tows once the oversight is identified.
The 23,844 Parking Department requested tows recorded through the LERMS database were
analyzed for the 13-month audit period for which the corresponding results are presented in Exhibit
1 below:
Exhibit 1
Results Number Percentage
Alternating: 23,474 98.45%
Not Alternating: 369 ; 1.55% I
Last in List(not able to be compared/Tremont) i 1 0.00
Total: 23,844 100.00%
r
Results for "Not Alternating"
Not Alternating - to the benefit of Tremont Towing: 169 0.71%
Not Alternating -to the benefit of Beach Towing: { 200 0.84%
Page 6 of 22
Page 1024 of 1430
Total for Tremont: 4I 11,907 ! 49.94%
Total for Beach: 11,937 y 50.06%
Although no alternation occurred in 1.55% of the requested public tows, the subsequent breakdown
showed that this difference was typically corrected. In summary, Beach Towing performed on a net
basis only 15 more public tows than Tremont Towing (11,937 — 11,907 = 30/2 = 15) during the 13-
month audit period ((23,474/2) + 200 — 15 = 11,922 x 2 companies = 23,844 total). This immaterial
0.0629% difference (15/23,844) was not investigated further. Exhibit 2 below provides a graphical
depiction of the percentage share of tow services assigned to each company per month.
Exhibit 2
Share of Towing Services Provided-Percentage Comparison
•Beech Towing Tremont Towing
86%
SO.06% 50.06% 50.02% 50.25% 50.15% 50.04% 50.17% 49.97% 49.97% 50.28% 50.08% 50.09% 49.86%
5106
}
10% 1111
I , , II I IOlT NOY DEC 1 IAN MAY JUN JULlUL AUG SEP OCT
2017 I 2018
4 -
Revenue Comparison
The information in the Parking Department's prepared monthly Excel spreadsheets includes the total
amounts paid by each tow customer. OIG staff used this information to perform a revenue
comparison (Exhibit 3 graphically and Exhibit 4 numerically) between the two towing companies, with
the following results:
• The average rounded amount paid by customers per tow was $255.45 which consisted of an
average of$268.60 for Beach Towing and $242.27 for Tremont Towing.
• Beach Towing's billings exceeded Tremont Towing's by$321,532 or by an average of 11.1% for
the 13-month audit period.
• The percentage difference decreased to 3.7% for the last two months reviewed (September 2018
and October 2018) from 12.4% for the first 11 months (October 2017 through August 2018).
Exhibit 3
Revenue Share- Percentage Comparison
•Beach Towey Tremont Town'
601{ 7
57.% 54.0% 53.3%
52.6% 52.4% 52.9% 53.2% 52.6% 52.7% 52.7% 51.7% 50.9% 50.9%
1IHRIIIHIIIIII
OCT NOV DEC IAN FEB MAR APR MAY JUN JUL AUG SEP OCT
2017 2021
Page 7 of 22
Page 1025 of 1430
Exhibit 4
Adjusted Total %Gap Between
Beach Towing Tremont Towing Grand Total Difference Revenues
- 2017
Oct $239,026 $213,975 $453,001 $25,051 11.7%
Nov $220,967 $190,249 $411,216 $30,718 16.1%
Dec $274,832 $234,259 $509,090 $40,573 17.3%
- 2018
L. Jan $249,688 $219,066 $468,754 $30,623 14.0%
t Feb $231,184 $209,961 $441,145 $21,224 10.1%
un
a1 Mar $344,078 $306,815 $650,893 $37,262 12.1%
C Apr $248,444 $218,940 $467,384 $29,504 13.5%
May $244,312 $219,797 $464,109 $24,515 11.2%
a) Jun $230,744 $206,690 $437,434 $24,054 11.6%
OC
Jul $265,823 $238,445 $504,268 $27,378 11.5%
Aug $233,677 $218,266 $451,944 $15,411 7.1%
Sep $209,929 $202,106 $412,036 $7,823 3.9%
Oct $213,566 $206,169 $419,735 $7,397 3.6%
Grand Total $3,206,271 $2,884,738 $6,091,009 $321,532
Average Difference for the 13-month period: 11.1%
Average Difference for the initial 11-month period: 12.4%
Average Difference for the last 2-month period: 3.7%
Average amount paid by Beach Towing's customers: $268.60
Average amount paid by Tremont Towing's customers: $242.27
Average amount paid by customers: $255.45
More specific testing was performed to determine the difference in the frequency of fees, established
in the Maximum Allowable Rates per Section 22 of the Towing Permits, such as hook-up fees,
storage fees, state sales taxes, dollies or flatbed service fees, labor to engage/tow fees, after-hour
fees, etc. levied per tow. The data showed that both companies appear to be relatively consistent
with the frequency in which the fees were applied, except for the dollies or flatbed services fee
(61.81% for Beach Towing compared to 9.79% for Tremont Towing) as shown in Exhibit 5 below.
Exhibit 5
Frequency of Additional Charges for Every Hook-up Fee
I L .... _
Adrn'n labor fvtiieage After Hour% Doily ac Storage >6 Spec,a!
■Beam. 99' 99"/. 99'4, 62"„ 62= 18= 2
it Tremont 100.4 99= 1Q0- 61), Icy-, 14;_ 1-,
Page 8 of 22
Page 1026 of 1430
Upon interviewing key personnel, reviewing the Parking and Police Department's body camera
footage, as well as other furnished supporting documentation, and covertly observing several tows in
January and February 2019, the following shortcomings were identified:
Finding #1: Customers Were Overcharged for Dollies or Flatbed Services Fees Not Rendered
at the Tow Locations
Dollies or flatbed services are required to transport all-wheel drive vehicles (so as not to damage their
transmissions), or when the vehicles' wheels will not roll properly for some reason. To help
compensate Tremont Towing for the additional time needed to install the dollies or the additional
expense in using flatbeds, Section 22(H)4 of the Towing Permits allows for an additional $40 fee to
be charged to its customers in these instances. The following picture shows the usage of a dolly on
a vehicle being pulled by a tow truck.
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Exhibits 6 and 7 below provide a comparative analysis of the number of times that dollies or flatbed
services were charged for each month of the audit period by tow company and the corresponding
amount of fees charged. As a result, it was found that Beach Towing charged the corresponding $40
fee approximately 650% more frequently Tremont Towing (7,179 compared to 1,106). However, the
difference became much smaller in September 2018(34 charges for Beach Towing vs. 29 for Tremont
Towing) and October 2018 (62 charges for Beach Towing vs. 46 for Tremont Towing). It was also
noted that the number of times that the dollies or flatbed services were charged decreased from an
average of 644 times per month for October 2017 through August 2018 to 48 times per month for
September and October 2018. This difference represents an estimated $258,870 (see Exhibit 8
below) additional amount in dollies or flatbed services charges, when the initial eleven-month period
(October 2017 —August 2018) is compared to the subsequent two-month period (September 2018—
October 2018).
Page 9 of 22
Page 1027 of 1430
Exhibit 6
Dollies or Flatbed Services Charges Utilization Comparison
LOCO
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o OYM, /M.TN, OK.w�M Lnuw7 FMru�ry
M1,N 64.0 Ih7 le. My August Sayeamber O. S.f
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•S thu.s.l6 664 SA Tri 679 627 670 644 443 969 696 441 M 66
.b.N•1 Towle' l66 74 96 Sl! 69 101 II 101 101 IS 16 $1 tl
Exhibit 6's vertical axis represents the number of times that dollies or flatbed services were charged. The horizontal axis is the
month in which dollies or flatbed services were charged during the audit period. The numerical figures below each month
represent the total number of times that dollies or flatbed services were charged during that month by each tow company.Beach
Towing is represented by the blue color bars;while Tremont Towing is represented by the orange color bars.
Exhibit 7
Tt Towing Total#of Charges Total Amount
__MEOW AnMent' I of Changes Amount
-2017
October 604 $24,155 106 54,200 710 $28,355
C November 570 522,790 74 $2,940 644 525,730
O December 725 528,985 96 $3,820 821 $32,805
- 2018
si
.r, January 675 $26,980 112 $4,440 787 $31,420
February 627 $25,065 69 $2,760 696 $27,825
>. March 870 $34,755 121 $4,820 991 $39,575
0
O April 646 $25,810 81 $3,220 727 $29,030
b May 643 $25,659 108 $4,290 751 $29,949
w June 584 $23,335 101 $4,005 685 $27,340
Iock
. July 698 $27,880 105 $4,165 803 $32,045
as
V August 441 $17,615 58 $2,310 499 $19,925
September 34 $1,350 29 51,155 63 $2,505
October 62 $2,480 46 51,835 108 $4,315
Grand Total 7,179 $286`859 1,106 $43,960 8,285 $330,819
Exhibit 7 displays the number of dollies or flatbed services charged per month and the corresponding amounts charged to tow
customers. Amounts shown were compiled using solely dollies or flatbed services charged,$40 for non-residents and$35 for
residents,and do not include arty other tow charges.
Page 10 of 22
Page 1028 of 1430
Exhibit 8
Tremont Towing
(8)Average (C)Average Impounded %of Dolly Charges
Impounded Vehicles Charged with a to Impounded
Vehicles Dolly Fee Vehicles(C/B)
885 94 11%
Monthly Average from Oct 2017 through August 2018(11 months)
.Monthly Average from Sept 2018 through Oct 2018(2 months) 830' _
(A)Average Monthly Number of Additional Dolly Charges When •
Compared the Initial Eleven-Month Period(Oct/17-Aug/18)to • 56
the Subsequent Two Month Period(Sep/18-Oct/18) , N `
Estimated Additional Number of Dolly Charges for the Initial • 619
Eleven-Month Period(A x 11)
Dolly Rates(Nonresident/Resident) $40/$35
Estimated Additional Amount of Dolly Charges for the Initial 1, " •
Eleven-Month Period,Applying Percentages for Residents and
$ 24,426
Nonresidents and Abandoned. ,. +'
•((6,555 x(94.49%+0.78%)x$40+(6,555 x(3.95%x$35))
Exhibit 8 shows the monthly rounded averages of impounded vehicles and dollies or flatbed services (abbreviated as dolly
above)charged and the percentage of the impounded vehicles that were charged dollies or flatbed services for the first eleven-
months(gold fill)and the final two-months of the audit period(light green fill). Additionally, the rounded difference between the
eleven-months average dollies or flatbed services charged and the two-month average of the same fee, was calculated.
A Miami New Times Article dated August 16, 2018 entitled "Beach Towing Tacks on Bogus "Flatbed"
Fees, South Beach Driver Says'1 discussed the apparent overcharging of the dollies or flatbed
services fee to a Beach Towing customer. A follow-up Miami New Times article dated August 23,
2018 and entitled "Miami Beach Cracks Down on Bogus Flatbed Fees From Towing Companies'2
commented that the Parking Department management informed both tow companies to charge
dollies or flatbed services fees only if they were used in public view with a City agent present.
OIG staff's subsequent analysis determined that although Tremont Towing's number of charged
doliies or flatbed services fees remained relatively constant from mid-August 2018 through October
2018, Beach Towing's corresponding fees significantly decreased. When both tow companies'
shared representative was questioned as to the reasons for Beach Towing's decrease, he responded
by email as foliows : "....on August 17, 2018 both companies voluntarily agreed not to assess
flatbed/dolly fees unless a City agent is present to notate the use of such equipment at the originating
site of the tow. As previously explained, dollies/flatbeds are not always used at the initiation of the
tow. This was a temporary and good faith proffer to avoid any confusion or misperception regarding
the assessment of such fees due to inaccurate reporting by the media. It was both companies
intention to address this temporary and voluntary practice with the City Commission when the towing
permits were renewed in December 2018, but the opportunity did not present itself. it is both
companies intention to revisit this matter with staff and/or the City Commission in the near future. in
sum, both companies are still using flatbeds/dollies consistent with their historical practices; however,
they are voluntarily waiving the flatbed/dolly fees for tows where a City agent is not present to notate
the use of such equipment."
OIG staff contacted the tow companies representative and the City's Parking Director to determine
the date that both parties mutually agreed to terminate this practice, but no documentation was
received. Consequently, it was assumed that this practice remained in effect at least until the
December 2018 City Commission meeting based on the above email.
1. rups:'lwww.miamirewtimes.com"contenUprintViewi10632612
2.httos:,/www.rriamtewtnes.comicontenUprintView/10649222
Page 11 of 22
Page 1029 of 1430
Next, OIG staff reviewed all Parking Department tow impound documentation, as well as all tow
receipts for the randomly selected seven-day period of October 9, 2018 through October 15, 2018
(172 tows). As only fourteen of these tows included the $40 dollies or flatbed services charge, the
subsequent seven-day period covering October 16 through October 22, 2018 was also tested which
increased our sample size to twenty transactions. Our objective was to review the corresponding
Parking Department's body camera footage to determine whether dollies or flatbed services were
provided for charged customers at the tow locations in adherence with the terms reportedly agreed
upon according to the August 23, 2018 newspaper article.
Of the 20 tows, for which body camera footage was reviewed, occurring on October 9, 2018 through
October 22, 2018, it was found that two were inconclusive because the body camera footage did not
accurately capture the entire tow. For the remaining 18 tows, it was determined that six were properly
charged, as dollies or flatbed services were used at the tow locations, and 12 were overcharged as
they were not used. Therefore, it was concluded that Tremont Towing was not fully complying with
the August 2018 agreed upon terms and that these sampled customers were overcharged by a total
of $480 ($40 x 12 = $480).
Recommendations:
The City Commission and City Administration should consider that the next Towing Permits include
the following provisions:
a. Require that during the vehicle retrieval the customer be provided, along with the invoice, a picture
of the vehicle on a dolly or a flatbed whenever a charge for such service is included, as well with
any VSR submitted to the Parking or Police Departments as part of the City's billing process by
the tow companies. The picture should show the vehicle license plate for accurate identification.
These requirements should also be stated in the Towing Bill of Rights.
b. Preclude the tow companies from billing for dollies or flatbed services unless they were used at
the tow locations and the VSRs are noted as such by the Parking Enforcement Specialists.
c. Allow for financial penalties that the City and/or the vehicle owners could invoke against a tow
company in the event of verified overcharges, similar to Broward County's Code of Ordinances
Section 81/2 - 16(b) and City of Miami City Code Section 42-109.
Tremont Towinq's Response:
Tremont Towing complies with the City's permit. The labor charge is applied to the tow when it is
necessary to gain entry to the vehicle (e.g., to release the emergency break). This can be completed
at the time of pickup or later after the vehicle is cleared from the location. Additionally, Tremont only
applies flatbed and/or dolly fees when a flatbed or dolly is used in the removal of the vehicle.
Tremont would welcome the City's implementation of an electronic system should funding be
available in the City's budget to allow for allow for retention of photos and computerization of the
vehicle storage receipt.
Finding #2: Customers Overcharged Due to Tow Companies' Incorrectly Rating the Towing
Weight Classification
Section 22(B) through (E) of the Towing Permits details the hook-up fees for the different classes of
vehicles ranging from $140 for Class "A" tows to $200 for Class IT tows. In summary, the Towing
Permits allow each tow company to bill hook-up fees based on the class of the wreckers/tow trucks
and/or car carriers as defined in Section 11 of the Towing Permits below:
Page 12 of 22
Page 1030 of 1430
A. Class "A" wreckers and slide back car carriers - commercially manufactured unit, with a rated
capacity of not less than 10,000 pounds, GVW(gross vehicle weight)
B. Class "B" wreckers - commercially manufactured units, with a rated capacity of not less than
18,000 pounds, GVW
Class "B" slide back car carriers — commercially manufactured unit, with a rated capacity of not
less than 20,000 pounds, GVW
C. Class "C" wreckers — commercially manufactured unit, with a rated capacity of not less than
36,000 pounds, GVW
According to the website automotozine.com3, the gross vehicle weight (also known as gross vehicle
weight rating) is explained as "...a safety regulation used to prevent the overloading of vehicles. It's
the maximum safe operating weight of a truck, including its net weight, plus driver, passengers, cargo,
and fuel. The gross vehicle weight rating doesn't change after a manufacturer determines it for a
vehicle".
Given this information, OIG staff found it difficult to believe that the Towing Permit provisions would
allow the tow companies to charge the customer higher rates when they use a larger wrecker/tow
truck than is needed to tow a vehicle. In other words, it would not be proper to charge the customer
hook-up fees of$200 (Class "D") when a Class "D" wrecker/tow truck is used to tow a vehicle with a
GVW of 8,000 pounds rather the $140 fee that would be charged for the appropriate Class "A"
wrecker.
A legal opinion from the City Attorney's Office was requested to confirm this interpretation, and the
following response was received:
"The maximum allowable rate to be charged by Beach Towing Services, Inc. or Tremont Towing, Inc.
(collectively, the "Towing Permittees") for any vehicle tow must be based upon, and solely depend
on, the Gross Vehicle Weight ("GVW") of the actual vehicle being towed, irrespective of the
classification of the wrecker("A", "B", "C" or"D")which is utilized for the towing of said vehicle by the
respective Towing Permittees.
In other words, pursuant to the Towing Permits, there is no prohibition on the Towing Permittees
employing a wrecker with a rating capacity greater than necessary to accomplish the tow of a
particular vehicle. However, should the Towing Permittees utilize a wrecker with a rating capacity
greater than necessary to effectuate the tow of a particular vehicle(when a wrecker of a lesser rating
capacity could safely carry out such tow), then the affected customer should only be charged based
upon the rates set forth in the Towing Permits for the lowest rated (least expensive) wrecker class
that could have been utilized to accomplish the tow based upon the towed vehicle's GVW."
In addition, OIG staff made the following assumptions in its testing:
a. Class "0" wreckers are not specifically addressed in the Towing Permits; therefore, they would
contain a rated capacity of equal to or more than 36,000 pounds (the maximum weight limit for
Class "C" wreckers).
b. As the rated capacities for Class "B" wreckers and side back car carriers was slightly different
(18,000 vs. 20,000 pounds respectively), then any vehicles whose GVW was more than 10,000
pounds but did not exceed 18,000 pounds would be charged Class "B" hook-up fees. If the
vehicles GVW exceeded 18,000 but not 36,000 pounds, then it would be charged Class"C" hook-
up fees.
3 h;tpS 1 automotozme.comigross-vehicle-weight-rating-explainedi
Page 13 of 22
Page 1031 of 1430
Testing was performed on the Parking Department's requested tows during the audit period to
determine Tremont Towing's compliance with Section 22(B) through (E) of the Towing Permits. As
such, OIG staff identified 11,294 tows requested by the Parking Department in which hook-up fees
were billed by Tremont Towing, based on the Excel monthly spreadsheets. Although these tows were
not listed as Class "A", "B", "C", or "D" on these spreadsheets, all tested tows were systematically
classified based on their corresponding fees charged to non-residential customers (ex. $140 = Class
"A", $145 = Class °B", $175 = Class "C" and $200 = Class "D").
Exhibit 9 below shows the number and percentage of Parking Department requested tows performed
by Class for each tow company during the audit period based on the Excel spreadsheets listed data.
Exhibit 9
Beach Towing Tremont Towing
Count of Class %of Class Count of Class % of Class
Breakdown Breakdown Breakdown Breakdown
Class A 11,067 95.29% Class A 11,250 99.61%
Class B 459 3.95% Class B 28 0.25%
Class C 74 0.64% Class C 5 0.04%
Class D 14 0.12% Class D 11 0.10%
Grand Total 11,614 100.00% Grand Total 11,294 100.00%
This analysis solely included tows in which hook-up fees were charged to customers according to the Parking Department's
provided monthly Excel spreadsheets. Any tows performed where hook-up fees were not assessed were excluded from analysis
which included tows of abandoned vehicles,instances where the tow documentation was apparently not submitted by the towing
company as no information was recorded in the spreadsheets,and any tows performed on a "no-charge"basis which included
tow services provided for City vehicles, crime victims,etc.
As shown above, Tremont Towing performed 11,250 Parking Department requested Class "A" vehicle
tows, for which a $140 fee or less was charged, and which represented 99.61% of their total tows
during the 13-month audit period. In addition, Section 22 of the Towing Permits states, "The permittee
shall not charge in excess of the following maximum allowable rates established by the City(as same
may be amended from time to time) ..."The $140 Class "A" base tow fee would be the maximum rate
for those tows but also the lowest of the base rates chargeable for all tows. Therefore, there would
be no risk of overcharging based on gross vehicle weight if Class 'A" fee is applied, as all tows
assessed hook-up fees greater than $140 would be classified as either Class "B", "C", or "D" tows.
Consequently, no additional testing was performed on Class "A" tows, and the OIG staff focused on
the tows in which the hook-up fees charged exceeded $140, which represented 0.39% of all Tremont
Towing tows.
Each sampled vehicle's make and model was obtained from the vehicle identification number and/or
license plate number listed on the VSR for the vehicle, as well as any attached supporting
documentation. Next, the gross vehicle weight ratings were obtained from internet searches of the
manufacturers' websites for these specific vehicles, which was then compared to the gross vehicle
weight limits in Section 11 of the Towing Permits. As a conservative measure, OIG staff always
selected the vehicle's most comprehensive trim available (the largest engine, extended cab, 4x4, etc.)
or the highest gross vehicle weight ratings listed for each of the tested vehicles.
Appendix A located at the end of this report lists the tested vehicles for each Class and their
corresponding impound numbers, make and model, gross vehicle weight ratings, etc. Due to their
relatively small number(28 Class "B" + 4 Class "C" + 10 Class °D" = 42 total), all the vehicles charged
Class "B", "C" and "D" hook-up fees by Tremont Towing were tested in which the following
summarized results were obtained:
Page 14 of 22
Page 1032 of 1430
a. 12 of the 28 Class "B" vehicle tows (42.86%) contained gross vehicle weight ratings equal to or
more than 10,000 pounds but less than 18,000 pounds and were properly charged. However,
the 16 remaining vehicle owners(57.14%)were overcharged, as their gross vehicle weight ratings
were less than 10,000 pounds.
b. All four Class "C" vehicle tows were overcharged, as they contained gross vehicle weight ratings
less than 18,000 pounds.
c. Five of the 10 Class "D" vehicle tows (50%) contained gross vehicle weight ratings equal to or
more than 36,000 pounds and were properly charged. The remaining five customers (50%)were
overcharged, as their gross vehicle weights were less than 36,000 pounds.
Lastly, it was determined that eight tows were assessed hook-up fees that exceeded the $200 Class
"D" maximum allowable rate established in Section 22 of the Towing Permits. Inquiries were made
with Tremont Towing's representative in which a satisfactory explanation was received for one of
these tows, while he also stated that the remaining seven tows were incorrectly charged ranging from
a low of $300 to a high of $400. These seven tows with excessive hook-up fees were also included
in the analysis above concerning the vehicle's gross vehicle weight ratings.
Recommendations:
The City Administration and/or City Commission should consider implementing the following
recommendations to improve customer knowledge and to increase Tremont Towing's responsibilities:
a. The Towing Permits, Towing Bill of Rights, and the signage displayed at Tremont Towing's offices
should more clearly define the applicable hook-up fee charges and the corresponding GVW
ratings so that tow customers can better determine whether the charged fees are valid for their
vehicles.
b. The burden of proof should be on the tow companies to show that any hook-up fees other than
the $140 Class "A" hook-up fee are valid, rather than putting the burden on less informed
consumers to determine the applicable charges based on their vehicles' GVW.
c. The Towing Permits should allow for financial penalties that either the City and/or the vehicle
owners could invoke against the tow companies in the event of verified overcharges, similar to
Broward County's Code of Ordinances Section 81/2 - 16(b) and City of Miami City Code Section
42-109.
Tremont Towing's Response:
Guidance from the City and amendment of the Ordinance is needed for Class D charges. Tremont
does not maintain any Class 0 wreckers and we have simply charged what the wreckers from the
City of Miami billed Tremont for City tows. We have implemented a training protocol to ensure
compliance until such time as the permit is amended to reflect the proper cost of Class D tows.
Finding #3: Customers Were Overcharged for Labor to Engage/Tow Fees Not Rendered at the
Tow Locations
Section 22(H)(5) of the Towing Permits states that the $30 labor to engage/tow fee "... is not an
automatic fee and may only be imposed when access to enter the vehicle is required to properly
engage/tow the vehicle." This fee is to be charged when the tow truck operator needs to enter the
vehicle to disengage the emergency brake, straighten the vehicle's wheels, etc. to facilitate towing
and to help avoid damaging the vehicles. Therefore, OIG staff concluded that the tow truck operators
would have to enter the vehicles at the tow locations to achieve these desired results and for the labor
to engage/tow fees to be charged.
Page 15 of 22
Page 1033 of 1430
As the 20 reviewed Parking Department transactions in finding #1, occurring from October 9, 2018
through October 22, 2018, contained charges for labor to engage/tow fees as well as dollies or flatbed
services fees, OIG staff concurrently observed the available footage to determine whether the tow
operators entered the vehicles at the tow locations. It was observed that eight tows were
inconclusive, as the body camera footage did not accurately capture the entire tow. Of the remaining
12 tows observed during this fourteen-day period, it was determined that three customers were
properly charged labor fees, as the tow operators were observed entering the vehicles at the tow
locations, but that nine customers were overcharged because no entrance was observed. Therefore,
it was concluded that Tremont Towing was not fully complying with Section 22(H)(5) of the Towing
Permits terms and these nine customers were overcharged by a total of $270 ($30 x 9 = $270).
A similar review of the Police Department's tow impound documentation, as well as all invoices for
the period of October 9, 2018 through October 15, 2018 (5 tows) was performed. Upon reviewing
the body camera footage retained by the Police Department, it was found that two tows were
inconclusive as the auditor could not tell if the tow operators physically entered the vehicles. Of the
remaining three tows, it was determined that all were overcharged as the tow operators were not
observed entering the vehicles at the tow locations. As a result, each of these three customers was
overcharged $30 for a total of$90 ($30 x 3 = $90).
In summary, body camera footage from the Parking and Police Departments was reviewed for 25
tows in which labor to engage/tow fees were charged in October 2018. Of these tows, ten were
inconclusive, as OIG staff could not determine whether the tow operators entered the vehicles at the
tow locations. For the remaining 15 tows, it was concluded that three were properly charged and 12
were overcharged by a total of$360 ($30 x 12 = $360).
OIG staff also analyzed how often the $30 labor to engage/tow fee was charged during the 13-month
audit period based on the data in the Parking Department's monthly Excel spreadsheets. The results
of this analysis showed that Tremont Towing charged labor to engage/tow fees for 11,230 of the
11,294 tows that were charged hook-up fees and which occurred from October 1, 2017 through
October 31, 2018 (99.43°/x), resulting in $334,477 being charged to their tow customers (see Exhibit
12 below).
Exhibit 10
Labor to Engage/Tow Fees Labor Charges Analysis
Count of % of Labor
Labor Charges $ Labor Charges
Hookup Fee Charges
- 2017 December 924 916 99.13% $27,226
November 756 748 98.94% $22,180
October 824 821 99.64% $24,390
- 2018 April 854 852 99.77% $25,360
August 864 849 98.26% $25,562
February 804 803 99.88% $23,885
January 840 833 99.17% $24,810
July 930 928 99.78% $27,595
June 819 815 99.51% $24,245
March 1,186 1,183 99.75% $35,290
May 855 855 100.00% $25,569
October 832 825 99.16% $24,505
September 806 802 99.50% $23,860
Grand Total 11,294 11,230 99.43% $334,477
Exhibit 10 shows the number of labor to tow/engage fees charged relative to the number of hook-up fees assessed, their
corresponding percentage,and the dollar amounts associated with the total number of labor to engage/tow fees per month and
cumulatively for the audit period of October 1,2017 through October 31, 2018.
Page 16 of 22
Page 1034 of 1430
A closer review of the charged labor to engage/tow fees listed on the Parking Department's Excel
monthly spreadsheets found that four exceeded the $30 maximum allowable rate which were
subsequently emailed to Tremont Towing's representative for an explanation on February 1, 2019.
On February 6, 2019, satisfactory explanations were received for two of these tows; however, the
explanations provided for the remaining two tows were insufficient to determine the reason for the
overcharges, so OIG staff concluded that the labor fees on these two tows were overcharged by an
estimated $102.00.
These two explanations were considered insufficient because they were incorrectly calculated based
on the Towing Permits' maximum allowable rates and the information listed. For example, the
representatives' response for the vehicle with impounded number 143132, for which a labor charge
of$99 was made, is "The labor fee did not exceed the maximum allowable rates. A $30 labor fee was
charged. In addition to the $30 labor fee, additional labor in the amount of$66 was charged pursuant
to Section 22(H)(1). The tow took a total of 1.5 hours to perform".
According to Section 22(H)(1) of the Towing Permits, the charge for a 1.5 hour of labor or waiting
time is $16.50 (1.5 - 0.5 hours = 1-hour x $16.50) when the first half hour is discounted. Thus, OIG
staff determined that the labor to engage/tow fees on these two tows were incorrectly billed in that
customers were charged fees ranging from a low of $60 to a high of$90.
Recommendations:
The City Commission and City Administration should consider that the next Towing Permits contain
provisions as follows:
a. Require that the customer be provided during the vehicle's retrieval, along with the invoice, one
or more picture(s) of the vehicle with the door open when this charge is billed, as well as a copy
of the VSR submitted to the Parking or Police Departments by the tow companies as part of the
City's billing process. The corresponding picture(s) should also show the vehicle's license plate
for accurate identification. These requirements should be stated in the Towing Bill of Rights.
b. Preclude the tow companies from billing labor to engage/tow fees unless the VSRs are noted as
such by the Parking Enforcement Specialists present at the tow locations.
c. Include financial penalties, that either the City and/or the vehicle owners could invoke against the
tow companies, in the event of verified overcharges, similar to Broward County's Code of
Ordinances Section 81/2 - 16(b) and City of Miami City Code Section 42-109.
Tremont Towing's Response:
Tremont provides an itemized receipt to every customer who retrieves his or her vehicle. Additionally,
signage encourages customers to retain their receipt is clearly displayed at the pick-up window.
We would have no issue with the City's Parking Enforcement being present and videotaping each
and every tow on City property but would request that the City implement an electronic record system
to streamline compliance.
Florida law already allows customers to seek redress in court. Tremont works with customers who
have questions and complaints about the charges and the vast majority of all disputes are resolved
amicably.
Finding #4: Time Information is not Always Present in Tow Invoices; and One Tested Storage
Fee Transaction was Incorrectly Charged.
Page 17 of 22
Page 1035 of 1430
Section 22(A) of the Towing Permits paraphrased states that the first eight hours of storage shall be
without charge and then it subsequently lists the daily storage rates based on the type and size of
vehicle. On average, Tremont Towing charged customers storage fees for only 14% of its tows as
most vehicles were retrieved within eight hours.
OIG staff reviewed a total of 172 towed vehicles' documentation from the randomly selected seven-
day period of October 9 through October 15, 2018 to determine the corresponding accuracy of
charged storage fees. Of these, five were missing the times that the vehicles were Impounded and
17 were missing the time that the vehicles were released to its owners.
Recommendations:
The City Administration and City Commission should consider that the next Towing Permits include
the following provisions:
a. Require that an automated time/date stamp be used rather than manual notations to help reduce
the possibility of errors or manipulation, and that this information be made available to the City
upon request. In the interim, Tremont Towing staff should always include the time that the vehicle
was impounded and the customer's retrieval time to facilitate storage fee calculations.
b. Require that tow customers receive copies of their VSRs, which contain the times that their
vehicles were impounded, so that they can accurately determine whether any storage fees
charged are appropriate. The tow companies should have the responsibility to fully explain any
charges to customers before any monies are remitted.
Tremont Towing's Response:
Since the time period evaluated by the audit, Tremont has already implemented a machine-generated
timestamp but if the City wishes to standardize the automated machine, we would welcome
recommendations and/or certifications as to the machine type and model from the Parking
Department or City Commission.
Additionally, Tremont provides all customers with copies of the receipts which contain the times the
vehicles were towed and retrieved from the lot.
Finding#5: Sales Taxes Charged and Collected on Police Department Requested Tows Appear
to be Unnecessary
A review of the supporting documentation provided for Tremont Towing's 178 sampled tows,
occurring from October 9 through October 15, 2018, found that they were consistently charging 7%
state sales tax on any amounts collected for administrative and/or storage fees. OIG staff did not
analyze Tremont Towing's monthly state sales tax returns to ensure that the correct amounts were
remitted, as this report focused only on public tows, and any sales tax monies paid would also include
any private tow taxable amounts, precluding a segregation of sales taxes charged on public tows.
However, the OIG staffs review of the State Statutes and ancillary documentation such as TAA —
103463° found that the administrative and/or storage fees are not taxable for vehicles lawfully
impounded for legal reasons. In subsequent conversations with the City Attorney's Office, it was
concluded that none of the Police Department's requested tows would appear to be subject to state
sales tax based on the known information. Although the exact amount collected in state sales taxes
is unknown as the Police Department did not create and maintain monthly Excel spreadsheets as did
the Parking Department, a portion may have been unnecessarily charged and collected.
4 -ttp s -e enue:av:floridarevenue cc^- ,3•.v_ibraryDocuments120 ,09:TAA-10346?
Page 18 of 22
Page 1036 of 1430
Recommendations:
Tremont Towing should confirm with the State of Florida before taking any definitive action; however,
OIG staffs position is that the 7% state sales tax should not be charged on administrative and/or
storage fees for vehicles lawfully impounded for legal reasons (Police Department requested tows).
If subsequently confirmed by Tremont Towing with the State of Florida, they should discontinue
charging and collecting sales tax on these tows, but until then all amounts collected should be timely
and completely remitted.
Tremont Towing's Response:
Following guidance from the Parking Department and/or City Commission we will consult with
Tallahassee, but all sales tax collected as already been remitted to Tallahassee and it is unlikely that
the State will refund the monies.
Finding #6: Deficiencies in the Required insurance Coverage Maintained
Section 4 of the Towing Permits specifies the required insurance coverage to be in full force and
effect at all times throughout the term. A copy of Tremont Towing's current insurance policy was
requested and promptly received from the City's Parking Department. As it had not been previously
reviewed by the City's Risk Management Division for sufficiency, OIG staff met with a Risk
Management Division employee on January 31, 2019 whereby the following coverage deficiencies
were noted:
• The named certificate holder was Tremont Towing, Inc. instead of the City of Miami Beach in the
workers' compensation certificate of liability insurance covering between 10/01/2017 and
03/01/2018 or the first 6 month of the audited period.
• The named certificate holder was the City of Miami Beach Parking Department instead of the City
of Miami Beach, which should be the named certificate holder.
Recommendations:
Tremont Towing should always maintain the required insurance coverage in accordance with the
Towing Permits. It was recently verified with the City's Risk Management Division that Tremont
Towing has resolved these coverage deficiencies and is compliant with Section 4's terms. Going
forward, the Parking Department Director and/or the Police Chief should instruct designated staff to
verify that Tremont Towing maintains the required insurance coverage in accordance with the Towing
Permits.
Finding #7: Invoices Contain Language that is Contrary to the Towing Permits
Section 22 of the Towing Permits specifies the maximum allowable rates for towing, removal, and
storage. More specifically, subsection H entitled "Special and additional charges" states "1. Extra
labor or extra waiting time $ 16.50 per hour after the first 30 minutes at the scene and prorated after
the 1st hour in 15 minutes increments". However, sampled Tremont Towing VSRs found that under
the section "Other Charges", they contained the following line item which contradicts Section 22's
terms: "$16.50 EVERY 15 MIN., After 30 minutes on scene, includes retrieving and special handling
In addition, Section 22 (H)(5) of the Towing Permits describes the labor to engage/tow fee and its
$30 maximum allowable rate, as "This is not an automatic fee and may only be imposed when access
to enter the vehicle is required to properly engage/tow the vehicle.". Yet, reviewed Tremont Towing
invoices stated "labor — open door or disconnect linkage $30", are incorrect as the Towing Permits
do not include disconnect linkage as a valid reason to impose this fee.
Recommendations:
Page 19 of 22
Page 1037 of 1430
The Parking Department Director should instruct Tremont Towing to promptly amend their invoices
so that they do not contradict the stated conditions in the Towing Permits and the tow customer is
charged correctly.
Tremont Towing's Response:
Tremont will work with the Parking Department and the City to update its invoices with the City's
Recommendations to make the receipt more understandable.
RECENT UPDATES
As any identified deficiencies plus the Parking Department's Excel spreadsheets containing the total
tow population during the audit period had been previously forwarded to the auditees and two exit
conferences to discuss the audit findings had already been held during 2019, a third exit conference
was not deemed necessary. Instead, the draft reports for both Tremont Towing and Beach Towing
were emailed to their shared attorney, Rafael Andrade, on July 15, 2020 in which both companies
were given 30 working days, or until August 27, 2020, to provide their management responses in
compliance with to Section 2-256(h), City of Miami Beach Code.
Mr. Andrade then requested OIG's supporting documentation related to findings 1, 2, and 3 in emails
sent between the 18" and 20' of August. The OIG provided the requested information to the City
Clerk's Office on August 24th. Mr. Andrade was notified via email on the same day that the eight CDs
containing the requested information were available from the City Clerk's Office upon receipt of the
payment of the cost of preparing the information. As of August 26th, the information still had not been
retrieved from the City Clerk's Office, but the tow companies' attorney was requesting additional time
until September 30th. The City's Inspector General agreed to extend the time to provide responses
until September 7th at 5pm.
In regard to finding #2, Mr. Andrade not only requested the supporting information for the 60 randomly
sampled Class B tows, but also for the remaining 399 Class B Beach Towing tows that were not
tested by OIG staff, and as such, had not been addressed in any of the three draft towing reports.
Nonetheless, OIG staff identified and submitted on September 7th all known information for these 399
Class B tows, including the impound numbers, to Mr. Andrade. As a courtesy, the City's Inspector
General extended the deadline for responses to both tow reports to September 9th at 5pm.
Mr. Andrade requested an extension to at least September 16th to perform research and test these
additional 399 Class B tows, which was declined by the Inspector General on September 8th. Mr.
Andrade provided a response on September 9th for the Beach Towing audit in which he claimed that
the Inspector General failed to disclose to the City Commission that on or about December 4, 2019,
he had referred the Beach Towing audit to the Miami-Dade State Attorney's Office (SAO)for criminal
investigation, and that inasmuch as Beach Towing is under criminal investigation it would refrain from
addressing the allegations until the SAO completes its investigation. The response is attached to the
Beach Towing audit report. Mr. Andrade did not respond on behalf of Tremont Towing.
On August 27, 2020, the day before the original response deadline, Tremont Towing's President and
CEO, Manny Diaz, contacted 010 staff to state that he had terminated Mr. Andrade's services and
had asked their litigation counsel, Alexander Orlofsky, to represent the company in the City's Audit.
Tremont Towing's representatives and their attorney met with OIG staff on September 10th to openly
discuss the audit findings addressed in their report and possible solutions. Based on the
documentation received, the draft report was revised and emailed to Mr. Orlofsky on September 14t"
for Tremont Towing's management responses. The management responses received are included
herein.
Page 20 of 22
Page 1038 of 1430
During the September 10`h meeting, Mr. Diaz claimed that his company did not receive the July 15,
2020 draft report as it was sent via email only to Mr. Andrade, who allegedly did not timely share its
contents and told the City that Tremont ended its attorney-client relationship with Mr. Andrade. The
OIG has been sending all audit correspondence exclusively to Mr. Andrade since being notified in a
December 14, 2018 email that he represented both tow companies. Mr. Diaz stated that he would
have responded timely if he had known about the latest draft and that he has already implemented
several of the prior draft's recommendations. He continued to state that the City could review any of
Tremont Towing's maintained body camera footage, which they had implemented several years ago
prior to this audit's inception. Beach Towing does not currently have its staff wear body cameras and
is not known to have implemented such corrective action.
• :: oved by:
oIA4,.. /raD20
•074! =n orino, Inspector General Date
Reviewed by:
q./tiN-__C )
C Ci AVX001-0
Mark Coolidge, Chief Audit Date
Completed by:
if kr 0 el I -2_,LI 2_,9 L.7
Norman B :i r '7 . .uty Chief Auditor Date
cc: Jimmy L. Morales, City Manager
Eric Carpenter, Assistant City Manager
Saul Frances, Parking Director
Richard Clements, Police Chief
John Woodruff, Chief Financial Officer
Michael Smith, Human Resources Department Director
Page 21 of 22
Page 1039 of 1430
Tremont Towing, Inc. -Towing Permits Compliance Audit- September 24, 2020
Appendix A.Tested vehicles for each tow class assigned and their corresponding impound numbers,make and model,gross vehicle weight ratings,etc.(Finding 1)
Green=Overcharged Class B Tows I I Blue=Overcharged Class C Tows I I Orange=Overcharged Class 0 Tows I
Hookup low Class Assigned
it Tows Impounded Vehicle Gross Weight Fee (Based on Hookup Fee
Ov,.rct.ark;ed U TOWS L-Aed Imoo unded Numb.Date/TimeQ Impounded Fr,rn Lo(alion a Vehicle Brood/Model el Vehicle Y-' Rating{GVWRI lbs. g Charged'!"Charged)
1 128907 10/11/17 40016TH ST,Miami Beach Ram 3500 2015 11,500 5145 _ B -^
2 130598 11/09/17 1800 PURDY AVE LOT,Miami Beach Ram 3500 2015 11,503 $145 B _
3 133943 01/05/18 1300 15TH ST,Miami Beach Ram 3500 2015 11,500 $145 B
4 __- 129339 10/18/17 800 EUCLID AVE,Miami Beach Ford F350 1999 � 11,200 $145 B
5 131351 11/24/17 728 OCEAN DR,Miami Beach Ford E350 r 2008 11,200 $145 B
6 137538 03/06/18 1100 WEST AVE,Miami Beach Ford F350 2005 11,200 $145 B
7 129883 10/28/17 1300 OCEAN CT,Miami Beach Chevrolet Express 3500 2017 10,400 $145 B
8 145804 07/13/18 1603 EUCLID AVE Chevrolet Express 3.500 2010 _ 10,400 $145 B
9 130602 11/09/17 1800PURDYAVE,Miami Beach Ford F350 -T 2015 10,200 $145 B
_ 10 132603 12/15/17 1600 WASHINGTON AVE,Miami Beach Ford F250-King Ranch 2017 10,000 $145 B
11 i 137057 02/26/18 1100 PENNSYLVANIA AVE,Miami Beach Ford F250 _ 2006 _ 10,000 $145 B
_ 12 140819 04/20/18 1600 WASHINGTON AVE,Miami Beach Ford F250 a 2011 T 10,000 $145 B
13 148787 08/31/18 3200 COLLINS AVE VanHoolT2145 2000 50,700 $300 D
14145513 07/07/18 1700 BAY RD,Miami Beach FreightlinerColumbia 120 2007 46,000 $400 D
15 146112 07/17/16 86(X)COLLINS AVE.Miami Beach International 7600 2005 33,000 _y_ $400,_ __- D
16 140453 04/14/18 ,19 NORMANDY DR,Miami Beach Int.ProStar Premium LF627 2009 32,000 $400 D
17 132852 12/19/17 130014TH TER,Miami Beach ,Int.DuraStar 4300 MA025 2016 25,999 54(X) D
1 _ 18 131230 11/21/17 50012TH ST,Miami Beach GMC Savana 2003 9,600 $145 B
2 19 132278 12/10/17 1411 COLLINS AVE,Miami Beach Ford Transit 350 2018 9,500 $145 B
3 20 135327 01/28/18 4008TH ST,Miami Beach Ford Transit 350 2015 9,500 $145 B
4 21 142870 05/26/18 1800 JAMES AVE BLK,Miami Beach Ford Transit 350 2018 9,500 $145 B
5 22 147485 08/08/18 OD0ISLAND AVE Chevrolet G30 Express 1997 9,500 $145 B
6 23 148713 08/29/18 1415 COLLINS AVE Ford Transit 350 2016 9,500 $145 8
7 24 130194 11/02/17 7700 ABBOTT AVE,Miami Beach Chevrolet Express 2500 _ 2013 9,460 $145 8
8 25 138247 03/16/18 1400 OCEAN CT,Miami Beach Ford E350 2006 9,400 $145 B
9 26 128434 10/02/17 300 23RD ST,Miami Beach Ford E250 2014 9,000 $145 B
10 27 128522 10/04/17 000 WASHINGTON AVE,Miami Beach _Ford E250 2011 9,000 $145 B
11 28 131811 12/03/17 ,318 20TH ST,Miami Beach GMC Savana 2500 2016 8,600 $145 B
12 29 141609 05/03/18 1200 OCEAN DR,Miami Beach Ford E150 2011 8,600 $145 B
13 30 134285 01/12/18 100 14TH ST BLK,Miami Beach Chevrolet Express 1500 2007 _ 7,200 $145 B
14 31 129452 10/20/17 1200 15TH TER,Miami Beach Ram 1500 _ 2016 6,950 $145 B
15 32 129517 10/21/17 1400 LINCOLD RD,Miami Beach ~Toyota Tundra 2008 6,400 $145 B
16 33 138576 03/19/18 500 10TH ST,Miami Beach Chevrolet Express 1500 2004 - 6,200 $145 B
17 34 138991 03/24/18 2700 SHERIDAN AVE,Miami Beach _Ford E450 2009 14,500 $175 C
18 35 145517 07/07/18 1600 LENOX AVE ,Ford E450 2010 14,500 $175 C
19 36 134927 01/21/18 200 6TH ST,Miami Beach Ford E350 2014 12,500 $175 C
20 37 128883 10/10/17 1600 WASHINGTON AVE,Miami Beach Ford Transit 350 2016 9,500 5175 C
22 39 134449 01/13/18 300 EUCLID CT,Miami Beach Isuzu NPR 2013 14,500 , $200 D
23 40 134357 01/12/18 700 LENOX AVE BLK,Miami Beach _Ford E450 2004 14,050 $200 D
24 41 151551 _ 10/19/18 1200 EUCLID AVE GMCSavana 3500 2018 12,300 $320 D
26 43 132400 43080.90069 355 19TH ST,Miami Beach Freghtliner M2 106 2018 33,000 200 D
27 44 128516 43012.48125 000 WASHINGTON AVE,Miami Beach _Hino 268 2010 25,950 400 _ D
Page 1040 of 1430 Page 22 of 22
oveM B�-1- Exhibit "B-2"
\P - 40y
•
a
�•
Joseph M. Centorino, Inspector General
TO: Honorable Mayor and Members of the City Commission
FROM: Joseph Centorino, Inspector General
DATE: September 24, 2020
AUDIT: Beach Towing Services, Inc. - Towing Audit
OIG No. 20-18
PERIOD: October 1, 2017 to October 31, 2018
This report is the result of a request made by the City Administration in November 2018 for the
then-existing Office of the Internal Audit to verify compliance of Beach Towing Services, lnc.
(Beach Towing) with selected provisions in the City of Miami Beach Administrative Ruies and
Regulations For Police and Parking Towing Permits (Towing Permits) that were in effect during
the audit period. An entrance conference meeting was held in December 2018 with Beach Towing
management to explain the audit process, to gain an understanding of their operations and to
obtain copies of any relevant documents.
Although the reviewed Towing Permits contain a myriad of points that require compliance from
Beach Towing, Office of the Inspector General (OIG) staff concentrated its testing primarily on
the accuracy of the City's monthly billings and the amounts charged to tested tow customers. To
help achieve these objectives, we reviewed the provided Standard Operating Procedures, work
performed, available body camera footage, documentation received from the City's Parking,
Police and/or Finance Departments, as well as copies of the Vehicle Storage Receipts received
from Beach Towing.
As this audit was nearing completion, the City Commission voted in favor of terminating the
internal audit at its June 5, 2019 meeting. At that time all internal audit work was immediately
terminated. This audit's termination was subsequently re-visited at the January 15, 2020
Commission meeting wherein it was decided that the newly created Office of Inspector General,
as an independent agency, had the authority to conclude the audit.
Consequently, the audit was resumed and has resulted in the issuance of three separate audit
reports, including this one. The other two audit reports consist of testing performed relative to
Tremont Towing, Inc. (Tremont Towing) and of the City departments involved in the towing
process. Although the work performed was reported separately, there may be some overlap in
the three reports, as noted shortcomings may involve more than one of the parties involved.
ACRONYMS
CAD = Computer Aided Dispatch
GVW = Gross Vehicle Weight(Rating)
LERMS = Law Enforcement Records Management System
VSR = Vehicle Storage Receipts
Page 1041 of 1430
INTRODUCTION
Chapter 106, Article V, of the Miami Beach City Code, provides for the issuance of towing permits
for the towing of vehicles identified by the City's Parking and Police Departments as requiring
removal from public and private property, as well as vehicle impoundments. The same two tow
companies, Beach Towing and Tremont Towing, have continued to operate exclusively in Miami
Beach since at least their selection based on their response to Request for Proposals No. 1-91/94.
The negotiated towing permits for the two companies have been revised as needed in the
following years.
More recently, City Resolution 2015-28918 was adopted on February 11, 2015 approving the
issuance of new Towing Permits to Beach Towing and to Tremont Towing for a three-year term
commencing on March 1, 2015 and expiring on February 28, 2018. Both companies' terms were
extended for an additional one year through February 28, 2019 with the passage of City
Resolution No. 2018-30161.
Next, the City Commission on December 12, 2019, approved a one-year extension for both tow
companies of the same terms with a reduction of their charged automated teller machine fees.
Although this extension expired in February 2020, Beach Towing is currently continuing to operate
on a month-to-month basis under its terms.
OVERALL OPINION
Among other tests performed, OIG staff conducted a data analysis of all requested public tows
occurring between October 1, 2017 and October 31, 2018, whereby selected supporting
documentation as well as Parking and Police Department body camera footage for tested days
was reviewed to determine whether the towing fees charged by Beach Towing were appropriate.
Throughout the audit process, communication was also maintained with the towing company's
representatives to request additional information and/or documentation. However, the received
responses were not always sufficient to clarify the perceived shortcomings. Although the data
obtained from its sample results was not extrapolated to draw conclusions on a larger scale to
the population, the outcomes from the audit process stated in this report suggest that the tow
companies need stronger oversight.
OIG staff believes that the Towing Permits need revision to help improve accountability and to
better ensure that individuals are being properly charged for public tows. Examples include, but
are not limited to, placing more responsibility on the tow companies to justify charges to individuals
whose vehicles are towed, better defining listed terms, clarifying any identified ambiguities, and
more clearly defining the roles of all parties. Without making these and other needed revisions to
the Towing Permits, the deficiencies noted in this audit report will most likely continue and tow
customers will have little recourse.
It is recommended that future Towing Permits include language requiring each tow company to
provide the vehicle owner with photographic evidence of the impounded vehicle on a dolly/flatbed
and/or the vehicle's door opened at the tow location, to support any corresponding charges. This
requirement would permit the consumers of tow services to determine the validity of the charges
at the time they retrieve their vehicles and to question any discrepancies. Once the owner leaves
the scene, it becomes less likely that discrepancies will be noted or refunds retrieved, particularly
by out-of-town owners.
Furthermore, the Parking Department employees present for all Beach Towing's Parking
��®�atQfc 430
Department public tows should function more as a consumer and City advocate, since they are
present at each tow location and can verify whether dollies/flatbed services were used or whether
the tow truck operators entered the vehicles on the Vehicle Storage Receipts (VSRs). Any
subsequently identified unsubstantiated differences should be promptly refunded to the consumer
and/or financial penalties imposed on the tow companies by the City.
For example, Broward County's Code of Ordinances Section 81/2 - 16(b) titled "Violations of
Towing and Immobilization Regulations" lists several violations(charging more than the allowable
maximum towing and immobilization rate, failure to maintain records for the required period, failing
to accept ail mandated methods of payment, among others) whereby the first violation results in
a $250 fine per violation, which increases to $500 for any repeat violations. Meanwhile, City of
Miami City Code Section 42-109 states that a "person who charges a vehicle owner a towing or
storage charge in excess of the rate described herein is liable to the vehicle owner for three times
the amount charged." Conversely, Miami Beach's Towing Permits and City Code remain
relatively silent on this issue, and there are currently minimal consequences for proven non-
compliance.
Although several sections of the Towing Permits stipulate the City's right to suspend or terminate
the permit if certain violations are incurred by permittees, enforcing such action could jeopardize
tow service in the City, as only two companies are presently authorized to operate within the City's
boundaries. Therefore, OIG staff believes that the City Commission should strongly consider the
possibility of expanding the tow market to include additional companies that would be required to
operate a tow yard within a designated number of miles from the City's boundaries. If approved,
this expansion would allow the City to impose a suspension or a termination of the agreement on
a company without adversely affecting the availability of tow services.
Another option to be explored is the possibility of in-sourcing the towing operations to be managed
by an existing City Department, or by a separately run department or other city-controlled entity.
Despite the potentially high set-up costs with purchasing/leasing the wreckers, hiring/training staff,
and preparing the location, there could be associated benefits including better control over
operations and increased City revenues, as well as more transparency and oversight capability.
The following shortcomings were noted during testing that require corrective action:
1. Of the 21 tows that charged the $40 dollies or flatbed services fee during the 14-day period
of October 9, 2018 through October 22, 2018 in which the Parking Department's reviewed
body camera footage, it was determined that eleven customers were properly charged, three
were inconclusive, and seven customers were overcharged. As a result, Beach Towing was
not fully complying with the August 2018 agreed upon terms, and these seven customers were
overcharged by a total of$280 ($40 x 7 = $280).
2. Beach Towing overcharged 55 Class B, 73 Class C and 12 Class D sampled customers on
hook-up fees of the 148 reviewed (140/148 = 94.59%) based on an analysis of their gross
vehicle weight ratings.
3. Beach Towing overcharged its customers on labor to engage/tow fees for 14 of 30 tows
sampled in October 2018, based upon a review of Parking and Police Department provided
body camera footage. As the tow operators were not observed entering the vehicles at the
tow locations, it was concluded that these 14 customers were overcharged by a total of $420
($30 x 14 = $420).
4. The amounts charged by Beach Towing for sampled October 2018 storage fees could not be
verified as their employees did not record the time/date indicating when the owners retrieved
the towed vehicles.
Pg043)630
5. The amounts charged and collected by Beach Towing for state sales taxes on administrative
and/or storage fees for Police Department requested tows does not appear to be justified,
based on a review of the State Statutes and Florida Department of Revenue Law Library
Technical Assistance Advisement (TAA) — 103463 with the City Attorney's Office.
6. Beach Towing did not maintain the required insurance coverage in accordance with Section
4 of the Towing Permits.
SCOPE, OBJECTIVES, AND METHODOLOGY
The scope of this audit was to determine Beach Towing's compliance with selected terms set
forth in the corresponding Towing Permits. The audit covered the period of October 1, 2017
through October 31, 2018, and it focused primarily on determining Beach Towing Services, Inc.'s
compliance with the following objectives:
• To determine whether vehicle owners were charged in accordance to the rates specified
in the Towing Permits and in conformity with the services received.
• To determine whether the required annual Business Tax Receipt Certificates were
obtained.
• To determine whether the required insurance coverage was maintained.
• Other procedures as deemed necessary.
This audit was conducted in accordance with the office's approved Standard Operating
Procedures. Those require that we plan and perform the audit to obtain sufficient, appropriate
evidence to provide a reasonable basis for our findings and conclusions based on our audit
objectives. We believe that the evidence obtained provides a reasonable basis for our findings
and conclusions based on our audit objectives.
The audit methodology included the following:
• Review of applicable provisions within the City Charter and Code of Ordinances, and City
Standard Operating Procedures;
• Interviews and inquiries of City and external companies' personnel in order to gain an
understanding of the internal controls (relative to the operations of the towing services),
assess control risk, and plan audit procedures;
• Performance of substantive testing consistent with the audit objectives, including but not
limited to examination, on a statistical and non-statistical sample basis, of applicable
transactions and records;
• Drawing conclusions based on the results of testing with corresponding recommendations,
and obtaining auditee responses and corrective action plans; and,
• Performance of other audit procedures as deemed necessary.
FINDINGS, RECOMMENDATIONS AND MANAGEMENT RESPONSES
The information provided below is relevant for the first four findings, as it represents the criteria
for the OIG's testing of sampled customer charges. Per Section 22 of the Towing Permits, Beach
Towing shall not charge more than the following maximum allowable rates established by the City
Permit (as same may be amended from time to time):
A The first eight hours of storage shall be without charge. Thereafter the following storage
PaP$9�04t440c430
rates shall apply per day:
1 Inside-Interior
a Motorcycles or Scooters $12
b Any vehicle less than 20 feet in length and 8 feet in width $30
c Any vehicle over 20 feet in length $40
2 Outside-Exterior
a Motorcycles or Scooters $10
b Any vehicle less than 20 feet in length and 8 feet in width $30
c Any vehicle over 20 feet in length $30
3 Boat and Trailer (Owner's Unit)
a Unit under 20 feet in length $20
b Unit 21 feet to 35 feet in length $35
c Unit over 35 feet in length $45
B Tow Rate Class "A" Tow Truck and Class "A" Car Carrier $140
C Class "B" Tow Truck $145
D Class "C" Tow Truck $175
E Class "D" Tow Truck $200
F Tow Rate Class "B" or"C " Car Carrier $125
G Use of Contractor's Boat Trailer, any length, including storage, per day:
1 Trailer up to 18 feet in length $50
2 Trailer 18 to 30 feet in length $75
3 Trailer over 30 feet in length $1 50
H Additional charges:
1 Extra labor or extra waiting time $16.50 per hour after the first 30 minutes at the
scene and prorated after the 1st hour in 15 minutes increments.
2 Mileage Charges $6 per mile, maximum of $42 per tow.
3 Administrative fee $35 maximum per tow.
4 Dollies or Flatbed Services $40
5 Labor to Engage/Tow (this is not an automatic fee and may only be imposed when
access to enter the vehicle is required to properly engage/tow vehicle.) $30
6 After Hour Fee (may be assessed for tows retrieved between the hours of 8:00 PM
and 8:00 AM.) $30
A maximum administrative charge, different from the administrative fees mentioned above in
Section 22(H)(3), not exceeding $30 (and not as an automatic "add-on", but only when required
to comply with Florida Statutes) may be imposed by the permittee (Beach Towing) for services
such as the processing of paperwork, clerical work, or title research. Administrative charges are
defined as costs associated with verification of a vehicle identification number; search of vehicle
for ownership information; preparation of paperwork required by Florida Statutes; preparation and
mailing of the notification letter(s); and preparation of vehicles for auction (including notification to
owner or lien holder). Administrative charges shall not be imposed on vehicles with a "police
hold" until or unless the hold is removed. Storage for City (confiscated) vehicles with "police
holds" is free of charge to the City.
These maximum allowable rates mentioned above shall not apply to City of Miami Beach
residents (such exemption(s)for City of Miami Beach residents shall hereinafter be referred to as
the "Miami Beach resident discount"). To be eligible for this resident discount, individuals must
provide proof of residency within the City of Miami Beach, and their driver's license information
must match the registration information of the vehicle being towed. The permittee shall maintain
a log documenting discounts given to City residents pursuant to the Miami Beach resident
discount, which log shall be available for inspection and copying by the City Manager or his
PEWV055 :4430
designee, upon request. The permittee shall prominently post a sign displaying the maximum
allowable rates for both City and non-City residents within the area(s) on its premises designated
for the vehicle owner or his agent to transact business.
Parking Department vs. Police Department Requested Tows
In total, the Law Enforcement Records Management System (LERMS) showed that there were
23,844 (90.96%) Parking Department requested tows and 2,371 (9.04%) Police Department
requested tows during the 13-month audit period. The Parking Department has established a
process whereby their Coin Room staff manually enter into monthly Excel spreadsheets a detailed
breakdown of all the individual fees charged to each towed vehicle owner by the tow company,
which includes, among others, storage fees, mileage charges, administrative fees, after-hours
fees, labor to engage/tow vehicle fees, and state sales taxes.
Conversely, the Police Department has not established a similar process for documenting the
individual amounts charged to each towed vehicle owner. Police Department's designated
employees enter a limited share of information from the Vehicle Storage Receipts (VSR)that are
received from the towing companies into the Computer Aided Dispatch (CAD) System for the
release of the vehicles before they are forwarded to the Records Section for filing. Shortly after
the month's end, a CAD System report is generated of all recorded Police Department requested
tows which is forwarded to the City's Finance Department for billing.
The detailed monthly Excel spreadsheets enabled OIG staff to perform a wide range of analyses
on the Parking Department's requested public tows. Similar information is not readily available
for the Police Department's requested tows, which only comprised 9.04% of the total tows.
Therefore, their tows were excluded from further analysis, but there is no basis upon which to
believe that analysis of those tows would differ from those of the Parking Department.
As the information in these Excel spreadsheets was entered through a manual data entry process,
a quality control test was performed to assess its reliability. All 350 tows performed by both tow
companies in a randomly selected 7-day period occurring between October 9, 2018 and October
15, 2018 were reviewed. The corresponding data present in 2,450 entry fields (7 fields x 350
tows) in the corresponding spreadsheets was compared to the applicable storage receipts and/or
invoices so that any identified inaccuracies could be quantified. When completed, it was
determined that only 16 of the entries contained errors or 0.65% (16/2,450), which means that
the accuracy rate was 99.35% ((2,450 — 16)/2,450). Based on these results, OIG staff relied on
the monthly spreadsheet data in performing various analyses for the audit period.
Alternating Tows
Parking Department management stated that Dispatchers are to manually alternate tow requests
between the two companies. If that practice is not followed at any given time, compensatory
measures are taken to ensure that an equal share of overall tow requests is maintained. For
example, if Beach Towing inadvertently received two consecutive tow requests, then Tremont
Towing is to receive two successive tows once the oversight is identified.
The 23,844 Parking Department requested tows recorded through the LERMS database were
analyzed for the 13-month audit period for which the corresponding results are presented in
Exhibit 1 below:
Exhibit 1
Results Number Percentage
Alternating: i 23,474 ! 98.45%
--
P61430
Not Alternating: 369 1.55%
Last in List(not able to be compared/Tremont) 1 0.00
Total: 23,844 100.00%
Results for "Not Alternating"
Not Alternating - to the benefit of Tremont Towing: 169 0.71%
Not Alternating -to the benefit of Beach Towing: 200 0.84%
Total for Tremont: 11,907 49.94% j
Total for Beach: 11,937 50.06%
Although no alternation occurred in 1.55% of the requested public tows, the subsequent
breakdown showed that this difference was typically corrected. In summary, Beach Towing
performed (on a net basis) 15 more public tows than Tremont Towing (11,937— 11,907 = 30/2 =
15) during the 13-month audit period ((23,474/2) + 200 — 15 = 11,922 x 2 companies = 23,844
total). This immaterial 0.0629% difference (15/23,844) was not investigated further. Exhibit 2
below provides a graphical depiction of the percentage share of tow services assigned to each
company per month.
Exhibit 2
Share of Towing Services Provided-Percentage Comparison
•Beach Towing c Tremont Towing
90.06% 50.06% 50.02% 50.25% 50.10% 50.04% 50.17% 49.97% 09.97% 90.22% 50.08% 00.09% 49.66%
90%
40%
SOK
20% _- ._ c _
k I_
20% ; — — –
•"
OCT I NOV I DEC I IAN i FEB MAR 1 APR 1 MAY I JUN I JUL I AUG 1 SE. 1 OCT 1
2017 2018
F -
Revenue Comparison
The information in the Parking Department's prepared monthly Excel spreadsheets included the
total amounts paid by each tow customer. The OIG staff used this information to perform a
revenue comparison (Exhibit 3 graphically and Exhibit 4 numerically) between the two tow
companies with the following findings:
• The average rounded amount paid by customers per tow was $255.45 which consisted of an
average of$268.60 for Beach Towing and $242.27 for Tremont Towing.
• Beach Towing's billings exceeded Tremont Towing's by$321,532 or by an average of 11.1°/0
for the 13-month audit period.
• The percentage difference decreased to 3.7% for the last two months reviewed (September
2018 and October 2018) from 12.4% for the first 11 months (October 2017 through August
2018).
Exhibit 3
P36946094430
Revenue Share-Percentage Comparison
e Beath Towing _Tre none Towing
SOK 52.1% 51.7% 54.0% 53.3% 52.4% 52.9% 53.2% 52.5% 52.7% 52.7% 51.7%
50.971 S0.l11
SOK
l
90K i•,-
2oK
10%
11111111
0„ ,
OCT NOV DEC I IAN FEB MAR APR MAY luN JUL AUG SIR OCT
I
2017 2018
t -
Exhibit 4
Adjusted Total %Gap Between
Beach Towing Tremont Towing Grand Total Difference Revenues
- 2017
Oct $239,026 $213,975 $453,001 $25,051 11.7%
Nov $220,967 $190,249 $411,216 $30,718 16.1%
Dec $274,832 $234,259 $509,090 $40,573 17.3%
2018
Jan $249,688 $219,066 $468,754 $30,623 14.0%
RS
t Feb $231,184 $209,961 $441,145 $21,224 10.1%
N
CJ Mar $344,078 $306,815 $650,893 $37,262 12.1%
C Apr $248,444 $218,940 $467,384 $29,504 13.5%
CD
> May $244,312 $219,797 $464,109 $24,515 11.2%
41 Jun $230,744 $206,690 $437,434 $24,054 11.6%
Ct
Jul $265,823 $238,445 $504,268 $27,378 11.5%
Aug $233,677 $218,266 $451,944 $15,411 7.1%
Sep $209,929 $202,106 $412,036 $7,823 3.9%:
Oct $213,566 $206,169 $419,735 $7,397 3.6%
Grand Total $3,206,271 $2,884,738 $6,091,009 $321,532
Average Difference for the 13-month period: 11.1%
Average Difference for the initial 11-month period: 12.4%
Average Difference for the last 2-month period: 3.7%
Average amount paid by Beach Towing's customers: $268.60
Average amount paid by Tremont Towing's customers: $242.27
Average amount paid by customers: $255.45
More specific testing was performed to determine the difference in the frequency of fees,
established in the Maximum Allowable Rates per Section 22 of the Towing Permits, such as
hook-up fees, storage fees, state sales taxes, dollies or flatbed services fees, labor to engage/tow
fees, after hour fees, etc. levied per tow. The data showed that both companies appear to be
relatively consistent with the frequency in which the fees were applied, except for the dollies or
flatbed services fee(61.81% for Beach Towing compared to 9.79%for Tremont Towing)as shown
in Exhibit 5 below.
PB§7el( 39 Q430
Exhibft$
Frequency of Additional Charges for Every Hook-up Fee
120'%
_______
r
Admin% laoor 't Mileage% Atter•Hour'z. Dolly _. Storage% Special'%
•Beach 99% 99% 99% 62% 62% 18>0 2%
e Tremont 100$. 99% 100% 61 10% 14% 1%
Upon interviewing key personnel, reviewing the Parking and Police Department's body camera
footage, as well as other furnished supporting documentation, and covertly observing several
tows in January and February 2019, the following shortcomings were identified:
Finding #1: Customers Were Overcharged for Dollies or Flatbed Services Fees Not
Rendered at the Tow Locations
Dollies or flatbed services are required to transport all-wheel drive vehicles (so as not to damage
their transmissions), or when the vehicles' wheels will not roll properly for some reason. To help
compensate Beach Towing for the additional time needed to install the dollies or the additional
expense in using a flatbed, Section 22(H)4 of the Towing Permits allows for an additional $40 fee
to be charged to its customers in these instances. The following picture shows the usage of a
dolly on a vehicle being pulled by a tow truck.
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FP§®9 c9fo34q 430
Exhibits 6 and 7 below provide a comparative analysis of the number of times that dollies or
flatbed services were charged for each month of the audit period by each tow company and the
corresponding amount of fees charged. They show that Beach Towing charged the $40 dollies
or flatbed services fee approximately 650% more frequently than Tremont Towing (7,179
compared to 1,106). However, the difference became much smaller in September 2018 (34
charges for Beach Towing vs. 29 for Tremont Towing) and October 2018 (62 charges for Beach
Towing vs. 46 for Tremont Towing). It was also noted that the frequency in which dollies or flatbed
services were charged decreased from an average of 644 times per month for October 2017
through August 2018 to 48 times per month for September and October 2018. This difference
represents an estimated $258,870 (see Exhibit 8 below) additional amount in dollies or flatbed
services charges, when the initial 11-month period (October 2017 -August 2018) is compared to
the subsequent two-month period (September 2018 - October 2018).
Exhibit 6
Dollies or Flatbed Services Charges Utilization Comparison
Ao
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I.
IO
.66
100
3 ..
sF iu .i$ _ t L
-
Otdb.r Nay.mMr O�c.rM� Nnu1n flMwry Mirth Mr8 M.9 U. Mr A463 34.144644/ Omber
2021 2011
.WM864 i,b 604 310 123 613 607 870 60 M3 SM 61. MI N 11
•Naomi TwN( l0. 74 96 112 69 121 II 106 101 166 31 21 M
Exhibit 6's vertical axis represents the number of times that dollies or flatbed services were charged. The horizontal axis is
the month in which the dollies or flatbed services were charged during the audit period. The numerical figures below each
month are the total number of times that dollies or flatbed services were charged during that month by each tow company.
Beach Towing is represented by the blue color bars; Tremont Towing is represented by the orange color bars.
Exhibit 7
$e g Tremont Towing Total#of Charges Total Amount
iota** Amount #of Charges Amount
- 2017
October 604 $24,155 106 $4,200 710 $28,355
c November 570 $22,790 74 $2,940 644 $25,730
t? December 725 $28,985 96 $3,820 821 $32,805
i+
N -2018
:+
January 675 $26,980 112 $4,440 787 $31,420
M February 627 $25,065 69 $2,760 696 $27,825
? March 870 534,755 121 $4,820 991 $39,575
C
D April 646 $25,810 81 $3,220 727 $29,030
C May 643 $25,659 108 $4,290 751 $29,949
oi June 584 $23,335 101 $4,005 685 $27,340
EIP July 698 $27,880 105 $4,165 803 532,045
t August 441 $17,615 58 $2,310 499 $19,925
September 34 $1,350 29 $1,155 63 $2,505
October 62 $2,480 46 $1,835 108 $4,315
Grand Total 7,179 $286,859 1,106 $43,960 8,285 $330,819
Exhibit 7 displays the number of dollies or flatbed services charged per month and the corresponding amounts charged to
tow customers. Amounts shown were compiled using solely dollies or flatbed services charged, $40 for non-residents and
$35 for residents, and do not include any other tow charges.
PAP 1 tf40404130
Exhibit 8
(8) (C)Average
Average Impounded %of Dolly Charges
Impounde Vehicles Charged to Impounded
d Vehicles with a Dolly Fee Vehicles(C/B)
919 644 70%
Monthly Average from Oct 2017 through August 2018(11 months)
06
Monthly Average from Sept 2018 through Oct 2018(2 months) 46,
(A)Average Monthly Number of Additional Dolly Charges When •
Compared the Initial Eleven-Month Period(Oct/17-Aug/18)to the 596
'Subsequent Two Month Period(Sep/18-Oct/18) +
'Estimated Additional Number of Dolly Charges for the Initial ;
6,555 •
•
Eleven-Month Period(A x 11) . .4;r4.4.7[4
Dolly Rates(Nonresident/Resident) x/$35, Y
Estimated Additional Amount of Dolly Charges for the Initial
Eleven-Month Period,Applying Percentages for Residents and it $258,870
Nonresidents and Abandoned. `Y' "
((6,555 x(94.49%+0.78%)x$40+(6,555 x(3.95%x$35))
Exhibit 8 shows the monthly averages of impounded vehicles and dollies or flatbed services(listed as dolly above)charged
and the percentage of the impounded vehicles that were charged dollies or flatbed services for the first eleven(11)months
(gold fill)and the final two(2)months of the audit period(light green fill).Additionally,the difference between the eleven(11)
month average dollies or flatbed services charged and the two(2)month average of the same fee, was calculated.
When contacted, Beach Towing's representative stated via email that the reasons for the
significant increase in dollies or flatbed services fees charged were due to the City's raising of the
streets and the tow company's loss of access to two of its three entrances/exits. He claimed that
the one remaining entrance/exit is subject to a sidewalk grade that causes vehicles to bottom out,
thereby causing damage, and that they had notified the City Administration of this issue since at
least 2016.
Furthermore, when asked for the reasons concerning the decrease in dollies or flatbed services
fees charged commencing mid-August 2018 through October 2018, Beach Towing's
representative responded as follows: "....on August 17, 2018 both companies voluntarily agreed
not to assess flatbed/dolly fees unless a City agent is present to notate the use of such equipment
at the originating site of the tow. As previously explained, dollies/flatbeds are not always used at
the initiation of the tow. This was a temporary and good faith proffer to avoid any confusion or
misperception regarding the assessment of such fees due to inaccurate reporting by the media.
It was both companies intention to address this temporary and voluntary practice with the City
Commission when the towing permits were renewed in December 2018, but the opportunity did
not present itself. It is both companies intention to revisit this matter with staff and/or the City
Commission in the near future. In sum, both companies are still using flatbeds/dollies consistent
with their historical practices; however, they are voluntarily waiving the flatbed/dolly fees for tows
where a City agent is not present to notate the use of such equipment".
OIG staff contacted the tow companies and City representatives to determine the date that both
parties mutually agreed to terminate this practice, but no documentation was received.
Consequently, it was assumed that they remained in effect at least until the December 2018 City
Commission meeting based on the above email.
Palie1681V430
It was subsequently confirmed with the City's Public Works Department that no material changes
have been made to the street or the grade of the sidewalk since 2016 as the streets were raised
prior to that time. Since Beach Towing has visible cameras to record the activities occurring
outside their offices, OIG staff requested access to view this footage to determine if dollies or
flatbed services were provided for tested tows other than at the original tow location. However,
their representative in a February 4, 2019 email stated that "Neither company has any footage
responsive to your request nor are they required to."
OIG staff covertly observed towed vehicles on two different occasions in January and February
2019 in which it was noted that some vehicles with chassis low to the ground were successfully
being delivered to Beach Towing's facility without the usage of dollies or flatbed services.
Examples of some of these towed vehicles being delivered are shown in the following pictures
taken from the video recordings. The objective was not to determine whether dollies or flatbed
services were charged for these specific transactions, but whether they were needed to navigate
the dip and to safely enter the tow yard without damaging the vehicles.
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A Miami New Times article dated August 16, 2018, entitled 'Beach Towing Tacks on Bogus
"Flatbed" Fees, South Beach Driver Says"' discussed the apparent overcharging of the dollies or
flatbed services fee to a customer. A follow-up Miami New Times article dated August 23, 2018
entitled 'Miami Beach Cracks Down on Bogus Flatbed Fees From Towing Companies"2
commented that the Parking Department management informed both tow companies to only
charge dollies or flatbed services fees if they were used in public view at the tow locations with a
City agent present.
To determine this statement's impact, a more detailed analysis was performed to determine the
frequency of doilies or flatbed services fees charged daily (see Exhibit 9), which showed a
decrease in charges after August 22, 2018. Furthermore, Exhibit 10 below shows a linear trend
analysis on the frequency of dollies or flatbed services fees charged daily for the days between
August 23, 2018 through October 31, 2018, or after the decrease was detected. It may be
observed that there is an upward trend on the number of dollies or flatbed services charged after
August 22, 2018. However, OIG staff could not ascertain whether all dollies or flatbed services
fees charged, prior and subsequent to the decrease detected, were or were not justifiable.
Exhibit 9
Dollies or Flatbed Services Charges
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Exhibit 9 shows the number of dollies or flatbed services charged per day during the months of July,August and September
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of 2018. As shown above,a significant decrease in dollies or flatbed services charges occurred after August 22nd, 2018.
Exhibit 10
Dollies or Flatbed Services Charges
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Exhibit 10 shows a linear trend analysis on the frequency of dollies or flatbed services charged per day from August 23'd,
2018 through October 31",2018.As shown above, an upward trend of dollies or flatbed services charged occurred.
Next, OIG staff reviewed all Parking Department tow impound documentation, as well as all tow
receipts for the randomly selected seven-day period of October 9, 2018 through October 15, 2018
(178 tows). As only seven of these tested tows included the$40 dollies or flatbed services charge,
the subsequent seven-day period, covering October 16 through October 22, 2018, was also
tested, which increased the sample size to a total of 21 transactions. The objective was to
observe the corresponding Parking Department's body camera footage to determine whether
dollies or flatbed services were provided at the original tow location for charged customers
consistent with the terms agreed upon, as indicated in the August 23, 2018 newspaper article and
the tow company representative's email.
Of the 21 tows reviewed on body camera footage that charged the $40 tee for dolly or flatbed
services between October 9, 2018 and October 22, 2018, it was found that three were
inconclusive as the reviewed Parking Department body camera footage did not capture the entire
tow. For the remaining 18 tows, it was determined that 11 were properly charged, and that seven
were overcharged as dolly or flatbed services were not used at the tow location. As a result, it
was concluded that Beach Towing was not fully complying with the August 2018 agreed upon
terms and these seven customers were overcharged by $280 ($40 x 7 = $280).
Recommendations:
The City Commission and City Administration should consider that the next Towing Permit include
the following provisions:
a. Preclude the towing companies from billing for dollies or flatbed services unless they were
used at the tow location and the VSR is noted as such by the Parking Enforcement Specialists.
b. Require that during the vehicle retrieval the customer be provided, along with the invoice, a
picture of the vehicle on a dolly or a flatbed whenever a charge for such service is included,
as well with any VSR submitted to the Parking or Police Departments as part of the City's
billing process by the towing companies. The picture should show the vehicle license plate
for accurate identification.
c. Allow for financial penalties that either the City and/or the vehicle owners could levy against a
towing company in the event of verified overcharges, similar to Broward County's Code of
Ordinances Section 81/2 - 16(b) and City of Miami City Code Section 42-109.
1 t44)6 3O 30
Beach Towinq's Response:
See Appendix B
Finding #2: Customers Overcharged by Incorrectly Rating the Towing Weight Classification
Section 22(B) through (E) of the Towing Permits details the hook-up fees for the different classes
of vehicles ranging from $140 for Class "A" tows to $200 for Class "D" tows. In summary, the
Towing Permits allow the applicable tow company to bill hook-up fees based on the class of the
wreckers/tow trucks and/or car carriers as defined in Section 11 of the Towing Permits below:
A. Class "A" wreckers and slide back car carriers - commercially manufactured unit, with a rated
capacity of not less than 10,000 pounds, GVW (gross vehicle weight)
B. Class "B" wreckers - commercially manufactured units, with a rated capacity of not less than
18,000 pounds, GVW
Class "B" slide back car carriers — commercially manufactured unit, with a rated capacity of
not less than 20,000 pounds, GVW
C. Class "C" wreckers — commercially manufactured unit, with a rated capacity of not less than
36,000 pounds, GVW
According to the website automotozine.com3, the gross vehicle weight (also known as gross
vehicle weight rating) is explained as "...a safety regulation used to prevent the overloading of
vehicles. It's the maximum safe operating weight of a truck, including its net weight, plus driver,
passengers, cargo, and fuel. The gross vehicle weight rating doesn't change after a manufacturer
determines it for a vehicle".
Given this information, OIG staff found it difficult to believe that the intent of the Towing Permits
is to allow the tow companies to charge the customer higher rates when they use a larger wrecker
than is needed to tow a vehicle. In other words, the OIG position is that it would only be proper
to charge the customer hook-up fees of $200 (Class "D") on an occasion when a Class "D"
wrecker is needed to tow a vehicle with a GVW requiring the larger wrecker, rather than charge
the higher fee when a smaller wrecker would have been appropriate for the tow.
A legal opinion from the City Attorney's Office was requested to confirm the OIG position on this
issue, and the following response was received: "The maximum allowable rate to be charged by
Beach Towing Services, Inc. or Tremont Towing, Inc. (collectively, the "Towing Permittees") for
any vehicle tow must be based upon, and solely depend on, the Gross Vehicle Weight ("GVW")
of the actual vehicle being towed, irrespective of the classification of the wrecker("A", "B", "C" or
"D") which is utilized for the towing of said vehicle by the respective Towing Permittees.
In other words, pursuant to the Towing Permits, there is no prohibition on the Towing Permittees
employing a wrecker with a rating capacity greater than necessary to accomplish the tow of a
particular vehicle. However, should the Towing Permittees utilize a wrecker with a rating capacity
greater than necessary to effectuate the tow of a particular vehicle (when a wrecker of a lesser
rating capacity could safely carry out such tow), then the affected customer should only be
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charged based upon the rates set forth in the Towing Permits for the lowest rated (least
expensive) wrecker class that could have been utilized to accomplish the tow based upon the
towed vehicle's GVW."
In addition, OIG staff made the following additional assumptions:
a. Class "D" wreckers are not specifically addressed in the Towing Permits; therefore, OIG staff
assumed they would contain a rated capacity of more than 36,000 pounds (the maximum
weight limit for Class "C"wreckers).
b. As the rated capacities for Class "B" wreckers and side back car carriers was slightly different
(18,000 vs. 20,000 pounds respectively),that any vehicles whose GVW was more than 10,000
pounds but did not exceed 18,000 pounds would be charged Class "B" hook-up fees. If the
vehicles GVW exceeded 18,000 but not 36,000 pounds, then it would be charged Class "C"
hook-up fees.
Testing was performed on the Parking Department's requested tows during the audit period to
determine Beach Towing's compliance with Section 22(B)through (E) of the Towing Permits. As
such, OIG staff identified 11,614 Parking Department requested tows billed hook-up fees by
Beach Towing according to the Parking Department's Excel monthly spreadsheets. Although
these tows were not listed as Class "A", "B", "C", or "D" on these spreadsheets, all tested tows
were systematically classified based on their corresponding fees charged to non-residential
customers (ex. $140 = Class "A", $145 = Class "B", $175 = Class "C" and $200 = Class 'D").
Exhibit 11 below shows the number and percentage of Parking Department requested tows
performed by Class for each towing company during the audit period based on the Excel
spreadsheets listed data.
Exhibit 11
Tremont Ting
Count of Class %of Class Count of Class %of Class
Breakdown Breakdown Breakdown Breakdown
Class A 11,067 95.29% Class A 11,250 99.61%
Class B 459 3.95% Class B 28 0.25%
Class C 74 0.64% Class C 5 0.04%
Class D 14 0.12% Class D 11 0.10%
Grand Total 11,614 100.00% Grand Total 11,294 100.00%
This analysis solely included tows in which hook-up fees were charged to customers according to the Parking Department's
provided monthly Excel spreadsheets. Any tows performed where hook-up fees were not assessed were excluded from
analysis,which included tows of abandoned vehicles,instances where the tow documentation was apparently not submitted
by the tow company as no information was recorded in the spreadsheets, and any tows performed on a"no-charge"basis
which included towing services provided for City vehicles,crime victims,etc.
As shown above, Beach Towing performed 11,067 Parking Department requested Class "A"
vehicle tows, which represented 95.29% of its total tows during the 13-month audit period. In
addition, Section 22 of the Towing Permits states, "The permittee shall not charge in excess of
the following maximum allowable rates established by the City (as same may be amended from
time to time) ..." Consequently, the $140 Class "A" tow fee is a maximum allowable rate and not
a fixed rate, so there is not known material risk of overcharging based on gross vehicle weight as
all tows assessed hook-up fees greater than $140 would be classified as either Class "B", °C", or
"D"tows. As there are not known associated risks in Class"A" tows for the City and the customer,
FPAge16gglif31430
no additional testing was performed in this area. Instead, OIG staffs focus was on the tows in
which the hook-up fees charged exceeded $140, which represented 4.71% of all the reported
Beach Towing tows.
Each sampled vehicle's make and model was obtained from the vehicle identification number
and/or license plate number listed on the VSR as weii as any attached supporting documentation.
Next, the gross vehicle weight ratings were obtained from internet searches of the manufacturers'
websites for these specific vehicles, which was compared to the gross vehicle weight limits
specified in Section 11 of the Towing Permits. As a conservative measure, the vehicle's most
comprehensive trim available (the largest engine, extended cab, 4x4, etc.) or the highest gross
vehicle weight ratings listed for each of the tested vehicles was always selected.
Appendix A located at the end of this report lists the tested vehicles for each Class and their
corresponding impound numbers, make and model, gross vehicle weight ratings, etc. Due to its
large size (459 Class "B" + 74 Class "C" + 14 Class "0" = 547 total), OIG staff randomly sampled
60 Class "B" hook-up fees and reviewed all 74 Class "C" and all 14 Class "D" hook-up fees for
further analysis. In summary, the following results were obtained:
a. Of the 60 randomly sampled Class "B" charged tows, there was insufficient information on the
VSRs for two of the tested vehicles to determine the make and model classification needed
to accurately determine their GVW. For the remaining 58 vehicles, it was concluded that three
were correctly charged, as their GVW was more than 10,000 but less than or equal to 18,000
pounds, and that 55 were overcharged, as their GVW was less than or equal to 10,000
pounds.
b. Of the 74 Class "C" tows analyzed, the GVW for one Lincoln Town Car limousine could not
be accurately determined. All 73 of the remaining Class "C" tows were found to have been
overcharged as none of the vehicles researched contained GVW ratings more than 18,000
pounds but less than or equal to 36,000 pounds.
c. Of the 14 Class "D" vehicle tows analyzed, there was insufficient information on three VSRs
to accurately determine their GVW. Of the remaining 11 Class 'D" vehicles, ten tows were
deemed to have been overcharged as their vehicles GVW was equal to or less than 36,000
pounds and one was correctly charged.
Lastly, the entire population of tows listed in the Parking Department's Excel monthly
spreadsheets was reviewed, and it was determined that four tows were charged hook-up fees
that exceeded the $200 Class "D" maximum allowable rate established in Section 22 of the
Towing Permits. Inquiries were made to Beach Towing's representative, who provided the
explanation that one tow customer was charged a lump sum $219 fee, and that the remaining
three tows were erroneously billed $300 each or $100 more than the maximum allowable rate
($100 x 3 customers = $300). These four tows were also included in the analysis above
concerning the vehicle's gross vehicle weight ratings.
Recommendations:
The City Administration and/or City Commission should consider implementing the following
recommendations to improve customer knowledge and to increase Beach Towing's
responsibilities:
a. The Towing Permits, the Towing Bill of Rights and the signage displayed at Beach Towing's
offices should more clearly define the applicable hook-up fee charges and the corresponding
GVW ratings so that tow customers can better understand which fees are valid for their
vehicle.
Paijitel6g74011t30
b. The burden of proof should be on the tow companies to prove that any charges other than
the Class "A" hook-up $140 fee are valid rather than leaving it to less informed consumers to
figure out the charges.
c. The Towing Permits should allow for financial penalties that either the City and/or the vehicle
owners could levy against the tow companies in the event of verified overcharges, similar to
Broward County's Code of Ordinances Section 81/2 - 16(b) and City of Miami City Code
Section 42-109.
Beach Towing's Response:
See Appendix B
Finding #3: Customers Were Overcharged for Labor to Engage/Tow Fees Not Rendered
Section 22(H)(5) of the Towing Permits states that the $30 labor to engage/tow fee "... is not an
automatic fee and may only be imposed when access to enter the vehicle is required to properly
engage/tow the vehicle." This fee is to be charged when the tow truck operator needs to enter
the vehicle to disengage the emergency brake or straighten the vehicle's wheels to facilitate
towing. Consequently, the tow truck operator would have to enter the vehicle at the tow location
to facilitate the tow and to avoid damaging the vehicle.
As the 21 reviewed Parking Department transactions in finding #1 included fees for labor to
engage/tow, as well as service charges of use of dollies or flatbeds, OIG staff examined available
body camera footage to determine if Beach Towing's tow operators entered the vehicles at the
tow locations. In doing so, it was found that six tows were inconclusive, as the body camera
footage did not accurately capture the entire tow. Of the remaining 15 tows observed during the
14-day period of October 9, 2018 through October 22, 2018, it was concluded that four customers
were properly charged labor to engage/tow fees as the tow operators were observed physically
entering the vehicles, and 11 customers were overcharged because no entry of their vehicles
occurred. Therefore, it was concluded that Beach Towing was not fully complying with Section
22(H)(5) of the Towing Permits terms and that these 11 customers were overcharged by a total
of $330 ($30 x 11 = $330)
A similar review of the Police Department's tow impound documentation, as well as all invoices
for the seven-day period of October 9, 2018 through October 15, 2018 was performed. Upon
reviewing the body camera footage retained by the Police Department for the corresponding nine
tows, it was found that six were inconclusive, as one could not tell if Beach Towing staff physically
entered the vehicles at the tow locations. Of the remaining, it was determined that all three were
overcharged, as the tow operators were not observed entering the vehicles at the tow locations.
As a result, each of these three (3) customers was overcharged by $30 for a total of$90 ($30 x 3
_ $90).
In sum, 30 Parking and Police Department tows with body camera footage were reviewed to verify
whether the $30 labor to engage/tow fees were properly charged to tested October 2018 tow
customers. Of these tows, 12 were inconclusive as OIG staff could not determine whether the
tow operators entered the vehicles at the tow locations. For the remaining 18 tows, it was
concluded that four were properly charged and 14 were overcharged by a total of$420 ($30 x 14
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= $420).
OIG staff also analyzed how often the $30 labor to engage/tow fee was charged during the 13-
month audit period based on the data in the Parking Department's monthly Excel spreadsheets.
The results of this analysis showed that Beach Towing charged this fee for 11,441 of the 11,614
tested tows occurring between October 1, 2017 and October 31, 2018 (98.51%), which resulted
in $343,313 being charged to their tow customers (see Exhibit 12 below).
Exhibit 12
Labor to Engage/Tow Fees Labor Charges Analysis
Count of Labor Charges %of Labor $ Labor
Hookup Fee Charges Charges
2017 October 855 843 98.60% $25,285
November 769 755 98.18% $22,735
December 956 945 98.85% $28,605
- 2018 January 876 869 99.20% $26,055
February 822 812 98.78% $24,313
March 1,211 1,191 98.35% $35,690
April 880 872 99.09% $26,155
May 869 855 98 39% $25,625
June 847 839 99.06% $25,140
July 957 941 98.33% $28,205
August 886 865 97.63% $25,935
September 834 817 97.96% $24,485
October 852 837 98.24% $25,085
Grand Total 11,614 11,441 98.51% $343,313
Exhibit 12 shows the number of labor to engage/tow fees (abbreviated as labor charges above) charged relative to the
number of hook-up fees assessed,their corresponding percentage,and the dollar amounts associated with the total number
of labor charges per month and cumulatively for the audit period October 1, 2017 through October 31, 2018. The maximum
allowed labor charge is$30 per instance, which is the most frequent recorded amount;however, actual individual charges
occasionally varied from this amount.
A closer review of the labor fees charged to engage/tow, as listed on the Parking Department's
Excel monthly spreadsheets, found that seven tows exceeded the $30 maximum allowable rate,
which were subsequently emailed to the Beach Towing representative for an explanation on
February 1, 2019. On February 6, 2019, satisfactory explanations were received for four of these
tows; however, the explanations provided for the remaining three were insufficient to clearly
determine the reasons for the overcharges. OIG staff determined that the labor fees on these
three tows were overcharged by an estimated $70.50.
In response, the towing company's representative stated that these amounts also included
"special and additional charges" allowed under Section 22(H)(1) of the Towing Permits. This
section states that any extra labor or extra waiting time may be charged at a rate of $16.50 per
hour, after the first 30 minutes at the scene and prorated after the 1st hour in 15 minutes
increments.
The three (3) explanations were considered insufficient because they were incorrectly calculated
based on the Towing Permits' maximum allowable rates and the information listed. For example,
the representatives' response for the vehicle with impounded number 148580, for which a labor
charge of $60 was made, is "The labor fee did not exceed the maximum allowable rates. A $30
labor fee was charged. In addition to the $30 labor fee, additional labor in the amount of$33 was
charged pursuant to Section 22(H)(1). The tow took a total of 1 hour to perform, including
disassembling the drive shaft at the point of the tow, and reassembling the drive shaft".
,l: ,6> 0430
In addition to the fact that the implied total amount charged in the response does not match the
actual labor amount charged ($30 + $33 # $60), it is stated in Section 22(H)(1) that the charge for
one (1) hour of extra labor or waiting time is $8.25 (1 - 0.5 hours = 0.5 hour x $16.50) if the first
half hour is discounted. Thus, OIG staff determined that the labor to engage/tow fee on these
three tows was incorrectly billed in that customers were charged fees ranging from a low of $60
to a high of$90.
Recommendations:
The City Commission and City Administration should consider that the next Towing Permits
contain provisions as follows:
a. Preclude the towing companies from billing for labor to engage/tow fees unless the VSRs are
noted as such by the Parking Enforcement Specialists present at the tow locations.
b. Require that the customer be provided during the vehicle's retrieval, along with the invoice,
one or more picture(s) of the vehicle with the door open when this charge is billed, as well
with the VSR when the document is submitted to the Parking or Police Departments by the
tow companies as part of the City's billing process. The corresponding picture(s)should show
the vehicle's license plate for accurate identification.
c. Include financial penalties, that either the City and/or the vehicle owners could invoke against
the tow companies, in the event of verified overcharges, similar to Broward County's Code of
Ordinances Section 81/2 - 16(b) and City of Miami City Code Section 42-109.
Beach Towinq's Response:
See Appendix B
Finding #4: Insufficient Information to Assess Storage Fees
Section 22(A) of the Towing Permits provides that the first eight hours of storage shall be without
charge and then lists the daily storage rates based on the type and size of vehicle. On average,
Beach Towing charged customers' storage fees for 18% of its tows as most vehicles were
retrieved within eight hours. Upon reviewing the furnished Beach Towing documentation, OIG
staff could not determine whether the charged storage fees were applicable as their employees
typically did not record the time/date that the customers retrieved the vehicles.
Recommendations:
The City Administration and City Commission should consider that the next Towing Permits
include the following provisions:
a. Require that an automated time/date stamp be used rather than manual notations to help
reduce the possibility of errors or manipulation, and that this information be made available to
the City upon request. In the interim, Beach Towing staff should either use military time or
denote the time as AM or PM to facilitate storage fee calculations.
b. Require that customers receive copies of their VSRs, which contain the times that their
vehicles were towed, so that they can accurately determine whether any storage fees charged
t O@Olf3430
are appropriate. The tow companies should have the responsibility to fully explain any
additional charges to the customer before they are billed and make payment.
Beach Towinq's Response:
See Appendix B
Finding #5: Sales Taxes Charged and Collected on Police Department Requested Tows
Appear to be Inappropriate
A review of the supporting documentation provided for Beach Towing's 178 sampled tows,
occurring between October 9 and October 15, 2018, found that they were consistently charging
7% state sales tax on any amounts collected for administrative and/or storage fees. OIG staff did
not analyze Beach Towing's monthly state sales tax returns to ensure that the correct amounts
were remitted as this report focused only on public tows and any sales tax monies paid would
also include any private tow taxable amounts, precluding a segregation of sales tax amounts
charged on public tows.
However, a review of the State Statutes and ancillary documentation such as TAA — 1034634
found that the administrative and/or storage fees are not taxable for vehicles lawfully impounded
for legal reasons. In subsequent conversations with the City Attorney's Office, it appears that the
Police Department requested tows are not subject to state sales tax based on the known
information. Although the exact amount collected in state sales taxes is not known as the Police
Department did not create and maintain monthly Excel spreadsheets like the Parking Department,
a portion may have been unnecessarily charged and collected.
Recommendations:
Beach Towing should confirm with the State of Florida before taking any definitive action;
however, OIG staffs position is that the 7% state sales tax should not be charged on
administrative and/or storage fees for vehicles lawfully impounded for legal reasons (Police
Department requested tows). If subsequently confirmed by Beach Towing with the State of
Florida, they should discontinue charging and collecting sales tax on these tows, but until then all
amounts collected should be timely and completely remitted.
Beach Towinq's Response:
See Appendix B
Finding #6: Deficiencies on the Required Insurance Coverage
Section 4 of the Towing Permits specifies the required insurance coverage to be in full force and
effect at all times throughout the term. A copy of Beach Towing's current insurance policy was
requested and promptly received from the City's Parking Department. As it had not been
previously reviewed by the City's Risk Management Division for sufficiency, OIG staff met with
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that Division on January 31, 2019, which led to the following deficiencies being noted:
• Evidence was not provided to the City indicating that they had either obtained the required
workers' compensation coverage or submitted a document stating that they have four or less
employees and are not required to have this coverage.
• The City is not named as an additional insured in the "Description of Operations/
LocationsNehicles" section.
Recommendations:
Beach Towing should always maintain the required insurance coverage in accordance with the
Towing Permits. The coverage deficiencies listed above should be promptly corrected. Also, the
Parking Department Director and/or the Police Chief should instruct their designated staff to
periodically verify that Beach Towing maintains the required insurance coverage in accordance
with the Towing Permits.
Beach Towing's Response:
See Appendix B
RECENT UPDATES
As any identified deficiencies plus the Parking Department's Excel spreadsheets containing the
total tow population during the audit period had been previously forwarded to the auditees and
two exit conferences to discuss the audit findings had already been held during 2019, a third exit
conference was not deemed necessary. Instead, the draft reports for both Tremont Towing and
Beach Towing were emailed to their shared attorney, Rafael Andrade, on July 15, 2020 in which
both companies were given 30 working days, or until August 27, 2020, to provide their
management responses in compliance with to Section 2-256(h), City of Miami Beach Code.
Mr. Andrade then requested OIG's supporting documentation related to findings 1, 2, and 3 in
emails sent between the 18`h and 20m of August. The OIG provided the requested information to
the City Clerk's Office on August 24m. Mr. Andrade was notified via email on the same day that
the eight CDs containing the requested information were available from the City Clerk's Office
upon receipt of the payment of the cost of preparing the information. As of August 26'h, the
information still had not been retrieved from the City Clerk's Office, but the tow companies'
attorney was requesting additional time until September 30'x. The City's Inspector General agreed
to extend the time to provide responses until September 7'h at 5pm.
In regard to finding #2, Mr. Andrade not only requested the supporting information for the 60
randomly sampled Class B tows, but also for the remaining 399 Class B Beach Towing tows that
were not tested by OIG staff, and as such, had not been addressed in any of the three draft towing
reports. Nonetheless, OIG staff identified and submitted on September 7`r all known information
for these 399 Class B tows, including the impound numbers, to Mr. Andrade. As a courtesy, the
City's Inspector General extended the deadline for responses to both tow reports to September
9m at 5pm.
Mr. Andrade requested an extension to at least September 16`h to perform research and test these
additional 399 Class B tows, which was declined by the Inspector General on September 8''. Mr.
Andrade provided a response on September 9`r' for the Beach Towing audit in which he claimed
IPASel Af 30
that the Inspector General failed to disclose to the City Commission that on or about December
4, 2019, he had referred the Beach Towing audit to the Miami-Dade State Attorney's Office(SAO)
for criminal investigation, and that inasmuch as Beach Towing is under criminal investigation it
would refrain from addressing the allegations until the SAO completes its investigation. The
response is attached to the Beach Towing audit report. Mr. Andrade did not respond on behalf
of Tremont Towing.
Ap• oved by:
./".c._ ./�`�I / ► a f a/ 02Do�,d
40•0o1' -torino, Inspector General Dat
Reviewed by:
6)(\it-t 11. °'q
Mark Coolidge, Chief Audito Date
Completed by:
C(f/
Norman Blai• ta, Depir Chief Auditor Date
cc: Jimmy L. Morales, City Manager
Eric Carpenter, Assistant City Manager
Saul Frances, Parking Director
Richard Clements, Police Chief
John Woodruff, Chief Financial Officer
Michael Smith, Human Resources Department Director
P1;30 0e3 of n30
Beach Towing Services, Inc. -Towing Permit Compliance Audit- September 24, 2019
Appendix A.Tested vehicles for each tow class assigned and their corresponding impound numbers,make and model,gross vehicle weight ratings,etc.(Finding 1)
1 Green=Overcharged Class B Tows Blue=Overcharged Class C Tows I Orange=Overcharged Class D Tows
it Tow, 5 Tow, Impounded Vehicle Gross AA'eight Honlrup iet. low CI,, '.Asy,fned jba'ed an
Over(h.r,;,'d lested Im;.nuud,.-i Nurrd..i o:,te'TIme Imp. unclad l r,.in for Jb..1, Vt.6,cl,N,,nd,Model Vi1.J;li Y, a Ratin.:(6VWRI lbs_ Char,,od Hookup lu llt-r,;edl
1 144337 03/26/18 800 MICHIGAN AVE,Miami Beach Hummer H1 1992-2006 10,300 $145 B
2 128828 10/09/17 300 24TH ST Miami Beach Ford Transit 350 2016 10,360 $145 B
3 128798 10/09/17 9 ISLAND AVE Miami Beach Ford F350 ______ _ _2017_ - _ 14,000 $145 B
4 138805 03/23/18 400 16TH ST BLK,Miami Beach Kenworth T680 2015 52,350 $200 D
1 5 129304 10/18/17.8300 HAWTHORNE AVE,Miami Beach Ford Expedition Limited 2010 7,900 $145 8
2 6 129376 10/19/17 100 LINCOLN RD,Miami Beach Chevrolet Express 1500 2008 7,200 $145 B
3 7 129441 10/20/17 1900 BAY RD,Miami Beach Land Rover Range Rover 2017 6,945 $145 B
4 8 129736 10/25/17 1600 WASHINGTON AVE,Miami Beach Mercedes-Benz G550 2013 7,055 $145 B
5 9 129952 10/29/17 1900 BAY R0,Miami Beach Mercedes-Benz GL63 AMG 2014 _ 7,165 $145 B
6 10 130231 11/03/17 1600 ALTON RD,Miami Beach Jeep Grand Cherokee Laredo 2017 6,500 $145 B
7 11 130583 11/09/17 200 23RD ST,Miami Beach Ford Transit 150 2015 8,600 $145 B
8 12 131167 11/20/17 1400 14TH ST,Miami Beach Ford F250 _ 2003 __ 8,800 $145 B
9 13 131930 12/05/17 100 20TH ST,Miami Beach Toyota Tundra 4 Door 2015 7,000 5145 B
10 14 131938 12/05/17 300 23RD ST,Miami Beach_ Ram 1500 SLT 2013 6,800 $145 - B
11 15 132418 12/12/17 1700 PURDY AVE,Miami Beach Nissan NV 1500 2013 8,550 5145 B
12 16 133030 12/22/17 1130 OCEAN DR,Miami Beach RAM 1500 2017 6,900 $145 B
13 17 133520 12/30/17 2100 WASHINGTON AVE,Miami Beach Chrysler Pacifica Touring 2017 6,005 $145 B
14 18 133849 01/04/18 1423 COLLINS AVE,Miami Beach Chevrolet Silverado 1500 2015 7,600 $145 B
- 15__ 19 133972 01/06/18 1800 BAY R0,Miami Beach GMC Yukon _2017 7,500 5145 -� B T
16 20 134250 01/11/18 000 ISLAND AVE,Miami Beach Land Rover Range Rover 2017 6,945 $145 8
-
17_ 21 134372 01/13/18 1600 MICHIGAN AVE,Miami Beach Jeep Grand Cherokee Limited 2015 - 6,500 $145 B
-
18 22 134722 01/18/18 4600 COLLINS AVE,Miami Beach Ford F1502007 8,200- 5145 B
19 _ 23 135143 01/25/18 1200 20TH ST,Miami Beach Jeep Wrangler -Unknown _ _ 5,400 $145 B --
~ 20 24 135893 02/07/18 1567 MERIDIAN AVE,Miami Beach Chevrolet Silverado 1500 2007 6,800 $145 B
21 25 135897 02/07/18 300 20TH ST,Miami Beach ,- !_ Tclyota Tacoma Preruner SRS 2007 T 5,450_ $145 _ B
22 26 136731 02/21/18 000 ISLAND AVE,Miami Beach BMW X5 2014 6,063 $145 B
23 27 136755 02/22/18 400 21ST ST,Miami Beach GMC Yukon 2018 7,500 $145 B
24 28 _ 136926 02/24/18 200 11TH ST,Miami Beach Nissan NV 1500 2015 8,550 $145 8
_ 25 _ 29_ 137088 02/26/18 300 74TH ST,Miami Beach Chevrolet Suburban 1500 2015 �!� 7,500 $145 B
26 30 137541 03/06/18 000 WASHINGTON AVE Ford Transit Connect XL 2012 5,005_~ $145 B
27 31 137699 03/09/18 11 ISLAND AVE,Miami Beach Ford F150 Lariat 2016 7,850 $145 - 8
28 32 138566 03/19/18 1800 BAY RD,Miami Beach Toyota Tundra Unknown 7,200 $145 B
29 33 138632 03/20/18 100 7TH ST,Miami Beach Ford Transit 150 Cargo 2015 8,600 $145 B
30 34 138636 03/20/18 1880 WEST AVE,Miami Beach Land Rover Range Rover 2016 6,945 $145 B
_ 31 35138640 03/20/18 5 ISLAND AVE,Miami Beach Ford Transit 150 Cargo 2015 8,600 $145 B
32 36 138776 03/22/181 WASHINGTON AVE,Miami Beach Nissan NV 2500 2016 __ 9,100 5145 B
33 _ 37 139170 03/26/18 10018 ST,Miami Beach Chevrolet Suburban 1500 2018 - 7,300, $145 B
34 38 139338 03/28/18 000 WASHINGTON AVE,Miami Beach Chevrolet Express 2500 2012 9,460 5145 _ - B ,
35 39 139983 04/06/18 700 WASHINGTON AVE,Miami Beach Ford Transit 250 2017 9,000 5145 B
36 _ 40 140235 04/09/18 2600 COLLINS AVE,Miami Beach Jeep Liberty Sport 2010 5,675 $145B
37 _ 41 141594 05/03/18'1600 ALTON RD,Miami Beach Chevrolet Suburban 2018 7,300 5145 B
38 42 142043 05/11/18 100 7TH ST Nissan NV 1500 2016 8,550 $145 B
39 43 i 142424 05/18/18 944 COLLINS AVE,Miami Beach GMC Yukon 2017 7,500 5145 8
40 44 143419 06/03/18 1500 LENOX AVE,Miami Beach Ford E150 Van 2008 8,600 5145 B
41 45 _ 144415 06/21/18 100 10TH ST,Miami Beach Ford F150 . Unknown 8,200 $145 B
42 46 144421 06/21/18 300 23RD ST Lincoln Navigator 2003 7,450 $145 ,_ _ 8 _
Page 1064 of 1430
Page 24 of 30
Beach Towing Services, Inc. - Towing Permit Compliance Audit - June 3, 2019
43 47 144855 06/29/18 1900 PURDY AVE Ram 1500 Laramie Longhorn 2016 6,950 5145 B
44 48 144867 06/29/18 100 20TH ST Chevrolet Express 3500 2009 9,600 5145 B
45 49 145133 07/02/18 1400 PENNSYLVANIA AVE,Miami Beach Chevrolet Suburban 1500 2018 7,300 5145 B
46 50 145297 07/05/18 200 JEFFERSON AVE,Miami Beach Nissan Armada 2017 7,500 5145 B
47 51 145544 07/08/18 1400 18TH ST Chevrolet Suburban 2013 7,400 5145 B
48 52 146534 07/23/18 0 WASHINGTON AVE! Ford E250 Van Econoline 2012 9,000 5145 B
-
_ 49 53 146965 07/31/18 1600 ALTON RD,Miami Beach Cadillac Escalade Ultra 2009 7,300 $14S _ B
50 54 147360 08/06/18 1100 WEST AVE,Miami Beach _Ford E250 2006 _ 8,600 $145 8
51 55 148072 08/18/18 300 24TH ST _ Chevrolet Tahoe 2018 7,300 $145 B
52 _ 56 148106 08/18/18 1600 ALTON RD Lexus GX 460 2017 6,600 5145 _ B
53 57 148704 08/29/18 1000 OCEAN CT,Miami Beach Chevrolet Suburban 1500 2018 7,300 5145 8
54 58 149354 09/11/18 709 ALTON RD,Miami Beach Ford E250 2006 8,600 5145 B
55 59 149794 09/19/18 200 23RD ST Ford Transit 250 2018 9,000 5145 B
56 60 146339 07/21/18 1100 WEST AVE,Miami Beach Chevrolet Express 1500 2012 7,600 5175 C
57 61 128507 10/04/17 1900 PURDY AVE,Miami Beach Dodge Sprinter 2500 2004 8,550 5175
58 62 132958 12/21/17 1600 WASHINGTON AVE,Miami Beach Mercedes Benz Sprinter 2500 2016 8,550 5175 C
- 59 63 146557 07/24/18 200 72ND ST,Miami Beach Dodge Sprinter 2500 2003 8,550 $175 C
`60 64 150276 09/27/18 2200 LIBERTY AVE,Miami Beach Mercedes Benz Sprinter 2500 2015 8,550 5175 C
61 65 151647 10/20/18 4500 COLLINS AVE Mercedes Benz Sprinter 2500 2012 8,550 5175 C
62 66 152222 10/31/18 100 10TH ST,Miami Beach Dod_ge Sprinter 2500 2004 8,550 5175 C
63 67 148668 08/28/18 1900 PURDY AV Ford Transit 150 2015 8,600 5175 C
64 68 133352 12/28/17 800 16TH ST,Miami Beach Dodge 2500 Ram 2000 8,800 5175 C
65 69 _ 146212 _ 07/19/18 1200 WEST AVE,Miami Beach Ram ProMaster 2500 2015 8,900 5175 C
66 70 149082 09/06/18 0 WASHINGTON AVE Ram 2500 Promaster Van 2015 8,900 5175 C
67 71 148842 09/01/18 49 COLLINS AVE Ford Excursion 2000 8,900 5175 - C
68 72 _ 139340 03/28/18 200 7TH ST,Miami Beach Nissan Titan XD 2016 8,990 $175 C
69 73 135312 01/27/18 700 WASHINGTON AVE,Miami Beach Ford Transit 250 2016 9,000 r $175 C
70 74 145777 07/13/18 100 21ST ST,Miami Beach Ford Transit 250 2017 9,000 $175 C
71 _ 75 146482 07/22/18 1600 ALTON RD,Miami Beach Ford Excursion 2005 9,200 5175 C
72 76 131519 11/27/17 000 WASHINGTON AVE,Miami Beach Nissan NV 35005/SV _ 2012 9,500 $175 C
73 77 138656 03/20/18 1833 BAY RD,Miami Beach Chevrolet G10 Express 1997 9,500 $175 C
74 78 130219 11/02/17 40 ISLAND AVE,Miami Beach Ford Transit 350 2017 9,500 5175 C
75 79 131022 11/18/17 2000 LIBERTY AVE,Miami Beach Ford Transit 350 2016 9,500 5175 C
76 80 131030 11/18/17 1300 WEST AVE,Miami Beach Ford Transit 350 2015_ 9,500 5175 C
77 81 131918 12/05/17 300 25TH ST,Miami Beach Ford Transit 350 2016 9,500 5175 C
78 82 133358 12/28/17 800 OCEAN OR BLK,Miami Beach Ford Transit 350 2017 9,500 $175 C
79 83 136056 02/10/18 1131 COLLINS AVE,Miami Beach Ford Transit 350 2018 9,500 5175 C
80 84 136695 02/20/18 100 20TH ST,Miami Beach Ford Transit 350 2018 9,500 $175 C
81 85 137511 03/05/18,1700 JAMES AVE,Miami Beach Ford Transit 350 2017 9,500 5175 C
82 � 86 139447 03/29/18 1034 PENNSYLVANIA AVE,Miami Beach Ford Transit 350 2015 9,500 $175 C
83 87 139607 03/31/18 100 LINCOLN RD,Miami Beach Ford Transit 350 2016 9,500 $175 C
84 88 139839 04/03/18 000 5TH ST,Miami Beach Ford Transit 350 2018 9,500 $175 C
85 89 140280 04/10/18 2100 PARK AVE,Miami Beach Ford Transit 350 2015 9,500 $175 C
_ 86 90_ 141758 05/05/18 2100 PARK AVE,Miami Beach Ford Transit 350 2018 9,500 $175 C
-
87 91 142168 05/12/18 1400 PENNSYLVANIA AVE,Miami Beach Ford Transit 350 2018 9,500 $175 C
88 a 92 144343 06/20/18 1600 WASHINGTON AVE BLK,Miami Beach Ford Transit 350 2017 9,500 $175 C
89 93 149611 09/15/18 1100 COLLINS AVE,Miami Beach Ford Transit 350 2017 9,500 $175 C
90 94 151145 10/12/18,100 10TH ST,Miami Beach Ford Transit 350 2018 9,500 $175 C
91 95 152062 10/28/18 1520 COLLINS AVE,Miami Beach Ford Transit 350 2015 9,500 $175 C
92 96 139645 03/31/18 400 81ST ST,Miami Beach Chevrolet Express 3500 2004 9,600? $175 C
Page 1065 of 1430
Page 25 of 30
Beach Towing Services, Inc. -Towing Permit Compliance Audit - June 3, 2019
93 97 147434 08/07/18 1500 DREXEL AVE,Miami Beach Chevrolet Express 3500 2005 9,600 $175 C
94 98 144607 06/24/18 400 22ND ST Chevrolet Express 3500 2013 9,660 5175 C
95 99 150395 09/29/18 100 10TH ST,Miami Beach Nissan NV 3500 5/SV 2012 9,900 5175 C
96 100 130765 11/12/17 1900 BAY RD,Miami Beach Dod:e S•rinter 3500 2006 9,990 5175 C
97 101 146676 07/26/18 200 16TH ST GARAGE,Miami Beach Ford F250 2016 10,000 5175
98 102 146246 07/20 18 2100 MIAMI BEACH DR,Miami Beach Hummer H1 1992-2006 10,300 5175
99 103 _ 140934 04/21/18 100 39TH ST,Miami Beach Chevrolet Ex•ress 3500 2018 10,384 $175
100 104 142172 05/12/18 1400 EUCLID AVE,Miami Beach Chevrolet Ex•ress 3500 2017 10,384 5175 C
101 105 148844 09 01/18 200 9TH ST Chevrolet Express 3500 2018 10,384 5175 C
102 106 152099 10/28/18 1700 JAMES AVE Chevrolet Express 3500 2018 10,384 $175
103 107 144587 06/23/18 8036 HARDING AVE,Miami Beach Dodge Ram 3500 2000 10,500 $175
104 108 133772 01/01/18 36 ISLAND AVE,Miami Beach Ford F350 1997 11,200 $175
105 109 139784 04/02/18 000 WASHINGTON AVE LOT,Miami Beach Dodge Ram 1500 2017 11,500 $175
106 110 148060 08/17/18 1800 WEST AVE Ram 1500 Promaster Van 2016 11,500 $175
107 111 149569 09/15/18 1600 COLLINS AVE Dod:-Ram 1500 2017 11,500 M C
108 112_ 145265 07/04/18 700 14TH ST,Miami Beach GMC Savana 3500 2014 12,300
109 113 140888 04/21/18 700 WASHINGTON AVE,Miami Beach Ford E350 2016 12,500 5175
110 114 142953 05/26/18 900 6TH ST,Miami Beach Ford E350 2014 12,500 5175
111 115 144637 06/24/18 100 21ST ST Ford E350 2013 12,500 $175
_ 112 116 143220 05/30/18 400 22ND ST,Miami Beach Ford F350 2006 13,000 $175
113 ® 140009 04/06/18 100 20TH ST Miami Beach Chevrolet Silverado 3500 2016 13,025 5175 C
114 _ ® 132741 12/17/17 1900 BAY RD,Miami Beach Ford F350 2017 14,000 5175 C
115 119 150426 09/29/18 1800 WASHINGTON AVE,Miami Beach Ford F350 2013 14,000 5175 C
116 120 138890 _ 03/23/18 900 EUCLID AVE,Miami Beach Dod a Ram 3500 2017 14,000 $175 C
117 121 144255 06/18/18 200 LINCOLN RD,Miami Beach Mitsubishi Fuso 2008 14,000 $175 C
118 122 137407 03/04/18 300 EUCLID AVE,Miami Beach Ford E450 2007 14,050 5175 C -
119 123 138244 03/16/18 1300 18TH ST,Miami Beach Ford E450 2002 14,050 $175 C
_ 120 124 141673 05/04/18 1 WASHINGTON AVE LOT,Miami Beach Ford E350 2007 14,050 5175 C
121 _ 125 146860 07/29/18 1400 JEFFERSON AVE,Miami Beach Ford E350 2007 14,050 $175 C
122 126 135035 01/22/18 700 PENNSYLVANIA AVE,Miami Beach Ford Van 2017 14,500 $175 ■
123 127 137771 03/10/18 1300 LINCOLN RD,Miami Beach Ford E450 2017 14,500 5175
124 128 139168 03/26/18 2500 PINE TREE OR,Miami Beach Ford E450 2009 14,500 $175 C
125 129 141244 04/27/18 1000 WEST AVE,Miami Beach Ford E450 2015 14,500 $175 C
126 130 142759 05/24/18 7715 HARDING AVE,Miami Beach Ford E450 2009 14,500 $175
127 131 143361 06/02/18 800 WASHINGTON AVE,Miami Beach Ford E450 2017 14,500 $175
128 132 143389 06/02/18 50 S SHORE DR,Miami Beach Ford E450 2017 14,500 $175
129_ 133 151349 10/15/18 100 10TH ST,Miami Beach Dod:-Grand Caravan GT 2017 6,050 5219 D
130 134 149396 09/12/18 800 S POINTE DR Mercedes-Benz Sprinter 2500 2011 8,550 $200 0
131 135 128942 10/12/17 200 19TH ST BLK,Miami Beach Ford 1-350 2016 12,500 $200 D
132 136 128511 10/04/17 1000 WEST AVE,Miami Beach Isuzu NPR 2004 14,500 $200 D
133 137 130197 11/02/17 1100 PENNSYLVANIA AVE,Miami Beach Ford 1-450 2017 14,500 5200 0
134 138 130940 11 16/17 1200 20TH ST Miami Beach HINO 155 2018 14,500 $300 D
135 139 140526 04/15/18 0 5TH ST Miami Beach Ford 1-450 2011 14 00 $200 0
136 140_ 137154 02/28/18 100 17TH ST,Miami Beach Mitsubishi FUSO FH100 1995 17,995 $200 0
137 141 143254 05/31/18 1400 BIARRITZ DR,Miami Beach GMC C5500 C Series 2006 19,500 $200 D
138 142 148580 08/27/18 100 31ST ST,Miami Beach GMC C5500 C Series 2007 19,500 5200 D __ __
143 130549 11/08/17 4300 COLLINS AVE,Miami Beach Ford F750 Unknown unknown $200 D
144 135676 02/03/18 1500 ALTON RD,Miami Beach Ford Transit Unknown unknown $145 - ____ B
145 142065 05/11/18 1800 PURDY AVE,Miami Beach trailer 2005 unknown 5145 J B
146 144593 06/23/18 1400 COLLINS AVE,Miami Beach Lincoln Town Car Limousine _ 2000 unknown $175 C
147 133046 12/22/17 2900 ALTON RD,Miami Beach Peterbilt 2012 unknown $300 D
148 150741 10/05/18 500 WEST AVE Isuzu - Unknown unknown $200 D
Page 1066 of 1430
Page 26 of 30
Beach Towing Services, Inc. -Towing Permit Compliance Audit - September 24, 2019
Appendix B
Law Offices of Rafael E. Andrade, P.A.
i6SS Meridian Avenue
7th Floor
Miami Beach, Florida 331.39
Telephone: 305.531.9511 www.randradelaw.co n
Facsimile.
305.673.5734 ralph(ahrandradelaw.corn
VIA EMAIL ONLY: JosephC eutoritio R_uniatnibeachfl.gov
September 9. 2020
Mr. Joseph C-entorine
Inspector General
City of Miami Beach
1130 Washington Avenue
6th Floor
Miami Beach FL 33139
Re: Beach Towing Services,Inc. -Towing Audit OIG No. 20-18
Mr. Centorino:
I represent the interest of Beach Towing Services. Inc._ concerning the above referenced
audit dated July 15. 2020. This letter is in response to your invitation for my client to rebut the
fundings in the audit.
Your conduct has deprived my client of the opportunity to respond to the audit. You fail
to disclose to the Cit., Commission that on or about December 4. 2019 you refereed the audit to
the Miami-Dade State Attorne'v's Office (SAO) for criminal investigation (Exhibit A).' and that
on New Year's Eve. you again contacted the SAO to induce them to take action(Exhibit B).=As
a result. my client is currently the subject of a criminal investigation for the unfounded criminal
conduct you allege in the audit. While my client would like to address the allegations, it must
refrain from dome so until the SAO completes its investigation. It appears it would be in the best
interest of all parties to not comment on the audit until the investigation is complete.
Sincerely.
s. Rafael E. Andrade
Rafael E. Andrade, Esq.
Exhibit A wa>obtamed from the Miami-Dade State Attome';'-Office pursuant to a Public Records Request. The
email was putially redacted b, the Shame-Dade State Attorney's Office
2 Exhibit B was obtained from the Miami-Dade State Attorney's Office pursuant to a Public Recoed,Request. The
email was partially redacted by the Miami-Dade State Attorney's Office
Page 1067 of 1430
Page 27 of 30
Beach Towing Services, Inc. - Towing Permit Compliance Audit- September 24, 2019
EXHIBIT A
From: Cer.torino Joseph oseCrhCentorno:alrn,amibeachtl.gov:,
Sent: Wednesday, D .errber 4, 2',-219 3-54 PM
To: Johr Perk es
Cc B:aiotta. Nor?ran
Subject: W.Bea::h '>ninq Draft Repor.
Attachments: Bea:h`owing Serle--L,. Inti.Dr:r'1 A,dit Report rh 03 14 'doc....
Hi John,
Glad to be able to catch up with you today. r have attached the audit report we discussed as vveii as the contact
information for the auditor who authored it,Norman Blaiotta. He is prepared to speak with you in person or by phone,
whenever that is convenient. Thanks for taking a look at this.
Joe
4 I
Joseph 1kf. Cii tortno
inspector General
u.f.ce of t^e ,suecty. gene ai
17CC 2L v£Sr'ti-r--.Cent ' J^Yk'.- V1: 22-1_4
TO. 1305 673 702C,'Fa.<335 67= 'S19
i o:;ephCentonnei,E'7.13nt i beairifi.eCv
From: Blaiotta,Norman<NorrnanBlaiotta0miamibeachfl.gc.v>
Sent: Wednesday, December 4, 2019 3:44 PM
To:Centorino,Joseph<iosephCentorinoAmiarnibeaehfl.g v>
Subject: Beach Towing Draft Report
As per your request.
Norman Blaiotta CIA CFE MBA, aerxicrAuditor
Oficr:oft'►e Inspector 3eneral
17CD Cawertitor Center Drive.Miami aGel. =3313g
Tee:3f-873-7040 e.t. 26e-gg'=a;:: 335-e73-75i6:work-mamibeachfl.pov
We are ccrnnr!ted to prowdmg exce&err pubbc cer,ce and;alety to aif who live. work and pay in ow vibrant. trop ca' h'-aorto
community.
Page 1068 of 1430
Page 28 of 30
Beach Towing Services, Inc. - Towing Permit Compliance Audit - September 24, 2019
EXHIBIT B
From: Certori•io. Josepn •-•JosephCentorino@m.amiPeachil.gev›
Sent: Tuesduv,Januarp,7,2020 3,06 PM
To: Joh'. Perkles
Cc Biaiona.. Norman
Subject: RE. 'Towing audit
Thanks John
Joe
4 • r:
. LJLI7.'04--I 1
Josepli M, Ceracraw
!nspector Genera
Off iLeof ti-te isdeLtv
113C Vilasi:•!ngloi.Ave_ o.
Wan+ Beach,L:4.'3139
Tel.3G 673 71:72C
4 osephCertor,n00 miarni achfi.ecv
From:John Perikles<JohnPerikles@MiamiSAO.corn›
Sent:Tuesday,January 7,2020 2:2.3 PM
To:Cen torino,Joseph eJosephCentorino@miamibeachfl.gov>
Subject:RE:Towing audit
•
POrgeV8/38"
Beach Towing Services, Inc. -Towing Permit Compliance Audit- June 3, 2019
I don't mid look.ing into this further,but would prefer to sit down with the investigators/auditors rather than do this by
phone.
John
From:Centoritio,Joseph<JusLpYCrnlu'rt
Sent:Tuesday,December 31, 201.9 2.25 PM
To:John Perikles<Jurinpe,H102s JP,',arr,,SAJ.:.orr>
Subject: Towing audit
Ni John.
Nappy New Year!
Just checking in on the towing audit we sent you before the holiday,to find out if someone there has had the time to
review it. I will be in the office this Thursday and Friday,if it would be convenient to talk. Otherwise, next week is
fine. i expect there to be some developments in the City's review of this matter shortly.
Thanks.
Joe
•
E}ET.4 H
Josevi-a M. Centor-rrn°
Inspector General
u't ac of the .S._rreral
113viYd _ Url AW__
rr o r
\Ian. Geacr-
Tel.3C5 673 702C
.loscphCertor r�_�n•iarn ;ea� it'.e::�
Plage 38 of 3030