Parking Violation Fee Collection Not Out of Reach

Not all private parking companies have gone down the road of issuing their parking violations.  Smaller operations, in particular, might operate under the belief that the additional workload to manage violations is beyond their budget or their resources. If a small staff contingent is already overworked, why would they want to add another level of responsibility?  Wouldn’t it be easier to either forgo violations entirely or farm the process out to a 3^rd party?  Don’t jump to that conclusion too quickly.  While there are hurdles to navigate and pros and cons to consider, many smaller private companies successfully manage violations. They generate a positive return on investment while seeing other operational benefits as well.  We’ve outlined a few things to think about so you can decide what makes the most sense for you.

Know what parking tickets or charges are possible before you start

First of all, it’s important to understand your market.  Municipalities differ in what and how they allow and manage tickets or charges for illegal parking. While there are some common practices across Canada, your first stop should be with your local municipal office.  You may need to work with your local municipality to create something suitable for your situation.

Expect to hear “Do I have to pay this private parking ticket?”

Part of your job if you choose to collect on parking violations is managing communications around the requirement for payment.  It’s common for people to question the authenticity of the charge. Furthermore, they question the company’s authority to issue it in the first place.  The average person also probably isn’t aware of the difference between a municipally issued “parking ticket” and private parking violations – if any (again depending on your municipality).

Let’s take a closer look at some of the pros, cons, and issues you’ll have to consider.

The Pros

• First and foremost, this is a potential revenue opportunity.  Unique to each operation, you’ll need to determine for yourself if the cost associated with implementing this will offset the potential revenue generated.  You also need to consider how much of a return will make the extra effort worth it.
• One of the benefits of the threat of further costs for parking illegally is that drivers tend to be more compliant with the rules.  If they know it’ll cost them for parking longer than they should or try to park without paying, they’re more likely to follow the rules and pay the required fees.  The first charge or action by you is often the only notice a person needs to understand the implications.  Compliance will improve over time, which could have an impact on your revenue and ROI analysis.
• Along with improved compliance comes happier customers.  Drivers will be less likely to park in reserved or permitted customer spaces so there will be fewer inconvenienced clients when a spot is unavailable.  This also makes it easier to manage prohibited parking times (for line painting, snow removal, etc.).  With notifications to customers via email, you have minimal illegal parkers (if any), and you can quickly make the spaces available again.

Violations

• Violation management software will help you to track repeat offenders and manage them appropriately.  There are different strategies you can consider, including collections, towing (cost restrictive), or booting a vehicle.  Often, parking management companies will work with a repeat offender to reduce the total owed to clear the account quickly and encourage future compliance.
• Many operations that start collecting for parking violations, find efficiencies in how they operate.  They deal with fewer issues with their good customers. They have a formal and practical process to deal with those in violation.  Some also find that with better compliance and procedures, they can consider more options for how they issue permits and manage their lots.  This often leads to further revenue opportunities because you better understand your customers.  For example, you might notice a large group of customers consistently stay beyond their allotted time which might be the catalyst for a new, longer permit type that you can sell for a premium.

The Cons

• You will have new operational costs.  The most significant costs will be around the staff and resources needed for patrol staff.  You will also need to factor in any costs for plate lookup for unknown vehicles which will be with local state or provincial departments.  Collections will also have a cost.  In many instances, parking operations try to manage collections themselves. Using collections is a last resort.  However, both processes will have costs.
• You need to manage this within the process required by your municipality.  This means meeting any municipal certification or licensing standards.  Patrol people, for example, need to be licensed to issue an official municipal ticket.  Work with your local municipality to understand what you can and can’t do outside of an official designation.  You may need to work out an arrangement with them to achieve a scenario that makes sense for you.
• If you are issuing municipal tickets, the municipality gets the ticketing revenue.  If this is the only option available to you, then any ROI is generated through improved compliance and more paid permits rather than fines or violations.

Collections

• Collections are not always easy.  Whether you choose to use an outside agency or manage it in-house, there is a cost associated with it.  You can help yourself by making the process of payment easier with an online payment and appeal system.  The addition of images to help document the violation typically leads to fewer appeals as it’s hard to debate evidence. You can check out our blog Pesky Outstanding Fines – The headache for parking managers for some suggestions on how to structure your collections process for the best results.
• You may be required to meet a formalized process to satisfy municipal requirements.  This often includes having clear evidence of where and when an infraction took place. Furthermore, allowing for an appeal process, and options for early payment discounts. A stable violations management system (like what you can get with OPS-COM) comes with many of those features already included, so this may be a simple hurdle to navigate.

Find out what others are doing

Other private companies have successfully implemented a process for fee collection of private parking violations.  If you have connections with colleagues in the industry, you might want to reach out and see what their experience was like.  We’ve had many conversations with parking operations about issuing and managing violations and would be happy to talk about your unique situation and options.  Feel free to contact us online or give us a call at 855-410-4141.