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Home
/ Auto
Insurance / Explained
/ Auto Speeding Ticket Laws

The town that lived off speeding tickets

By Karen Aho

Posted : 10/19/2011

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Randolph, Mo., is a tiny town with a common problem: money is
tight.

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car insurance quotes now.]

To keep afloat, the Kansas City outpost apparently did what many little towns
on big highways do. It came to rely on passing motorists filling its municipal
coffers one traffic ticket at a time.

The problem came last year when, 15 years after Missouri passed a law capping
certain ticket collections at 35 percent of a town's revenue, the state decided
to actually enforce the law.

It's unclear why state auditors suddenly opened the town's books, but upon
doing so they discovered that Randolph--population 47--had collected more than
three-quarters of its $270,000 budget the year before from traffic fines issued
on state and federal roads. By law, money that exceeds the 35 percent limit must
be turned over to county schools.

Car insurance rates spike for speeders

An even greater chunk of change doesn't go toward any public good--city or
otherwise. That's the hundreds of thousands of dollars those motorists will
collectively pay to auto
insurance companies, which almost always raise premiums for ticketed
drivers.

A driver with one speeding ticket might pay an additional 20 percent or more
for the three to six years the ticket remains on his record, an analysis by
Insurance.com found. Multiple tickets could add thousands of dollars to a
driver's insurance charges. (For more, see "The
$5,000 speeding ticket.")

With towns across the country grasping for funding in recent years, and with
the situation only expected to worsen, drivers may want to proceed through all
'burbs with extreme caution. Individual officers may concentrate on public
safety, but the data show that departments tend to increase the number of
tickets issued during hard times.

Welcome to town, have a ticket

One analysis even calculated an average dollar-to-destitutioncorrelation. A
2006 study by the Federal Reserve Bank of St. Louis ("Are traffic
tickets countercyclical?") found that towns increased the number of tickets
issued by an average of 0.4 percent for every 1 percent decline in other
revenue.

Concerned drivers can, however, take heart in a smattering of laws intended
to prevent towns from treating traffic tickets as a revenue stream.

At least three states now limit the amount of income a town can collect from
traffic tickets, according to the National Conference of State Legislatures.
Arkansas and Missouri cap the overall percentage of a town's budget gleaned from
state and federal highways at 30 percent and 35 percent, respectively. New York
state prohibits a town's ticket revenue from exceeding the equivalent of $5 per
resident, with any excess going to the state's general fund.

Other states appear to be joining the mix. Oklahoma can strip the ticketing
powers on state and federal highways from a town that has generated more than 50
percent of its revenue from traffic fines. Vermont and Louisiana are among other
states that have introduced similar legislation.

No more ticket money for you

Texas has capped ticket revenue since 1975. During a 1989 revision, the
Patton Village police chief became so outraged at the bad press his town
received--Patton Village was essentially funding itself through Highway 50
speeders--that he went on a hunger strike, limiting himself to "coffee, water
and an occasional beer," the Dallas Morning News reported at the time.

At least Patton Village did not go bankrupt as a result, a fate that befell
tiny Macks Creek, Mo., after that state's law was put into effect in 1995. The
town, nearly 85 percent funded by passing motorists, had issued a ticket to the
wrong driver--one with the right connections. That driver was a state
legislator, and he promptly went home and drafted what is now known as Macks
Creek Law, the legislation that caps the percentage of a town's budget gleaned
from state and federal highways at 35 percent.

These days, several other states try to discourage any abuse of police powers
by essentially minding the treasure chest. Certain traffic tickets--typically
including speeding violations on highways--are automatically processed by the
state, which then returns a set amount to the issuing town.

In California, for example, towns keep about 20 percent of the driver's fine
for speeding. In Connecticut, towns get just $10 a ticket. The state of
Massachusetts keeps about half of the portion of the fine that exceeds $50.

"It seems to work," says Robert Katims, a lawyer with Hoff Curtis, in
Burlington, Vt. "There is no incentive for people to set up speed traps because
they don't keep the money. The money goes to the state."

But beware the holes in any system. The National Motorists Association, a drivers'
rights group, cautions that because some tickets don't get routed through the
state, an officer merely has to rephrase the violation a bit.

The full fine then goes directly to the city or town and the baffled driver,
initially pulled over for speeding, heads home with a citation for, say,
inattentive driving.

"Some city administrators game the system by having their police write
tickets for local ordinance violations rather than for speeding, in order to
avoid mandatory reporting to the state," says Gary Biller, motorist association
spokesperson.

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